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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 Paid-in Capital in Excess of Par— Common ($85,000 – $5,000) .......................... 80,000 Preferred Stock .................................................. 10,000 Paid-in Capital in Excess of Par— Preferred ($15,000 – $10,000) ....................... 5,000 EXERCISE 15-11 (15–20 minutes) Item Assets Liabilities Stockholders’ Equity Paid-in Capital Retained Earnings Net Income 1. I NE I NE I I 2. NE NE NE NE NE NE 3. NE I D NE D NE 4. NE NE NE NE NE NE 5. D NE D NE D D 6. D D NE NE NE NE 7. NE I D NE D D 8. NE NE NE I D NE 9. NE NE NE NE NE NE
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