Chp 15 Exercises and Problems Solutions

Chp 15 Exercises and Problems Solutions - EXERCISE 15-2...

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EXERCISE 15-2 (15–20 minutes) Jan. 10 Cash (80,000 X $5). ........................................ 400,000 Common Stock (80,000 X $1). ................ 80,000 Paid-in Capital in Excess of Stated Value—Common Stock. ...................... 320,000 (80,000 X $4) Mar. 1 Cash (5,000 X $108). ...................................... 540,000 Preferred Stock (5,000 X $100). .............. 500,000 Paid-in Capital in Excess of Par Value—Preferred Stock. ...................... 40,000 (5,000 X $8) April 1 Land. ................................................................ 80,000 Common Stock (24,000 X $1). ................ 24,000 Paid-in Capital in Excess of Stated Value—Common Stock. ...................... 56,000 ($80,000 – $24,000) May 1 Cash (80,000 X $7). ........................................ 560,000 Common Stock (80,000 X $1). ................ 80,000 Paid-in Capital in Excess of Stated Value—Common Stock. ...................... 480,000 (80,000 X $6) Aug. 1 Organization Expense. .................................. 50,000 Common Stock (10,000 X $1). ................ 10,000 Paid-in Capital in Excess of Stated
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Value—Common Stock. ...................... 40,000 ($50,000 – $10,000)
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EXERCISE 15-2 (Continued) Sept. 1 Cash (10,000 X $9). ........................................ 90,000 Common Stock (10,000 X $1). ................ 10,000 Paid-in Capital in Excess of Stated Value—Common Stock. ...................... 80,000 (10,000 X $8) Nov. 1 Cash (1,000 X $112). ...................................... 112,000 Preferred Stock (1,000 X $100). .............. 100,000 Paid-in Capital in Excess of Par Value—Preferred Stock. ...................... 12,000 (1,000 X $12) EXERCISE 15-5 (10–15 minutes) (a) FMV of Common (500 X $165) $ 82,500 FMV of Preferred (100 X $230) 23,000 $105,500 Allocated to Common: $82,500/$105,500 X $100,000 $ 78,199 Allocated to Preferred: $23,000/$105,500 X $100,000 21,801 Total allocation (rounded to nearest dollar) $100,000 Cash. .......................................................................... 100,000 Common Stock (500 X $10). .............................. 5,000 Paid-in Capital in Excess of Par— Common ($78,199 – $5,000). ......................... 73,199 Preferred Stock (100 X $100). ........................... 10,000 Paid-in Capital in Excess of Par—
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Preferred ($21,801 – $10,000). ...................... 11,801 (b) Lump-sum receipt $100,000 Allocated to common (500 X $170) 85,000 Balance allocated to preferred $ 15,000 Cash. .......................................................................... 100,000 Common Stock. ..................................................
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This note was uploaded on 11/30/2010 for the course BUSINESS 4230 taught by Professor Dee during the Spring '10 term at Community College of Denver.

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Chp 15 Exercises and Problems Solutions - EXERCISE 15-2...

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