405ch15solutions

405ch15solutions - EXERCISE 15-2 (1520 minutes) Jan. 10...

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EXERCISE 15-2 (15–20 minutes) Jan. 10 Cash (80,000 X $5). ........................................ 400,000 Common Stock (80,000 X $2). ................ 160,000 Paid-in Capital in Excess of Stated Value—Common Stock (80,000 X $3). ........................................ 240,000 Mar. 1 Cash (5,000 X $108). ...................................... 540,000 Preferred Stock (5,000 X $50). ................ 250,000 Paid-in Capital in Excess of Par Value—Preferred Stock (5,000 X $58). ........................................ 290,000 April 1 Land. ................................................................ 80,000 Common Stock (24,000 X $2). ................ 48,000 Paid-in Capital in Excess of Stated Value—Common Stock ($80,000 – $48,000). ............................. 32,000 May 1 Cash (80,000 X $7). ........................................ 560,000 Common Stock (80,000 X $2). ................ 160,000 Paid-in Capital in Excess of Stated Value—Common Stock (80,000 X $5). ........................................ 400,000 Aug. 1 Organization Expense. .................................. 50,000 Common Stock (10,000 X $2). ................ 20,000 Paid-in Capital in Excess of Stated Value—Common Stock
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($50,000 – $20,000). ............................. 30,000
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EXERCISE 15-2 (Continued) Sept. 1 Cash (10,000 X $9). ........................................ 90,000 Common Stock (10,000 X $2). ................ 20,000 Paid-in Capital in Excess of Stated Value—Common Stock (10,000 X $7). ........................................ 70,000 Nov. 1 Cash (1,000 X $112). ...................................... 112,000 Preferred Stock (1,000 X $50). ................ 50,000 Paid-in Capital in Excess of Par Value—Preferred Stock (1,000 X $62). ........................................ 62,000 EXERCISE 15-5 (10–15 minutes) (a) Fair value of Common (500 X $168). .................................... $ 84,000 Fair value of Preferred (100 X $210). .................................... 21,000 $105,000 Allocated to Common: $84,000/$105,000 X $100,000. ....... $ 80,000 Allocated to Preferred: $21,000/$105,000 X $100,000. ...... 20,000 Total allocation. ...................................................................... $100,000 Cash. .......................................................................... 100,000 Common Stock (500 X $10). .............................. 5,000 Paid-in Capital in Excess of Par— Common ($80,000 – $5,000). ......................... 75,000
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Preferred Stock (100 X $100). ........................... 10,000 Paid-in Capital in Excess of Par— Preferred ($20,000 – $10,000). ...................... 10,000 (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. .................................................. 5,000
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This note was uploaded on 11/05/2011 for the course ACCT 405 taught by Professor Caylor during the Summer '11 term at South Carolina.

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405ch15solutions - EXERCISE 15-2 (1520 minutes) Jan. 10...

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