Chapter%2013%20Homework%20Solutions

Chapter%2013%20Homework%20Solutions - 13–24(a Cash...

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Unformatted text preview: 13–24. (a) Cash .............................................................................. 600,000 Common Stock ........................................................ 40,000 Paid-In Capital in Excess of Par ............................ 560,000 Issued 20,000 shares of $2 par common stock at $30. (b) Organization Expense ................................................ 9,000 Common Stock ........................................................ 500 Paid-ln Capital in Excess of Par ............................ 8,500 Issued 250 shares of $2 par common stock in return for legal services in organizing corporation. (c) Compensation Expense ............................................. 10,000 Common Stock ........................................................ 600 Paid-ln Capital in Excess of Par ............................ 9,400 Issued 300 shares of $2 par common stock to employees; objective market value of stock = $10,000. (d) Buildings ...................................................................... 295,000 Land .............................................................................. 80,000 Common Stock ........................................................ 25,000 Paid-In Capital in Excess of Par ............................ 350,000 Issued 12,500 shares of $2 par common stock in exchange for a building and land valued at $295,000 and $80,000, respectively. (e) Cash .............................................................................. 247,000 Common Stock ........................................................ 13,000 Paid-ln Capital in Excess of Par ............................ 234,000 Issued 6,500 shares of $2 par common stock at $38. (f) Cash .............................................................................. 180,000 Common Stock ........................................................ 8,000 Paid-ln Capital in Excess of Par ............................ 172,000 Issued 4,000 shares of $2 par common stock at $45. 13–32. Total compensation expense over the 3-year service period (2010–2012) is $315,000 ($7 fair value 45,000 options). The journal entry required in each year of the service period is as follows: Compensation Expense ($315,000/3 years) .............. 105,000 Paid-In Capital from Stock Options ....................... 105,000 The journal entry to record the exercise of all 45,000 of the options on December 31, 2013, is as follows: Cash (45,000 $29) ...................................................... 1,305,000 Paid-In Capital from Stock Options ............................ 315,000 Common Stock ....................................................... 90,000 Additional Paid-In Capital in Excess of Par ......... 1,530,000 13–33. Probable 2012 sales at December 31, 2010 ........... $ 450,000 Options for probable sales ..................................... 20,000 Fair value of options at grant date ......................... $9 Estimated compensation expense from options.. $ 180,000 Number of years in service period ......................... Number of years in service period ....
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This note was uploaded on 04/06/2011 for the course ACCT 4050 taught by Professor Rodney during the Spring '11 term at UGA.

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Chapter%2013%20Homework%20Solutions - 13–24(a Cash...

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