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Quiz chap15 - 4 The company issues 500 shares of common...

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Quiz Chapter 15 Accounting 3312 Spring 2011 Name: __________________________ 1. Equity transactions. Presented below is information related to Lowary Company: 1) The company is granted a charter that authorizes issuance of 40,000 shares of $50 par value preferred stock and 30,000 shares of no-par common stock. 2) 10,000 shares of common stock are issued to the founders of the corporation for land valued by the board of directors at $600,000. The board establishes a stated value of $5 a share for the common stock. 3) 10,000 shares of preferred stock are sold for cash at $70 per share.
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Unformatted text preview: 4) The company issues 500 shares of common stock to its attorneys for costs associated with starting the company. At that time, the common stock was selling at $55 per share. Instructions Prepare the general journal entries necessary to record these transactions. No entries land 600000 Common stock 50000 Additional paid-in capital 550000 cash 700000 Preferred stock 500000 Additional paid-in capital 200000 AP 27500 Common stock 2500 Additional paid-in capital 25000 Page 1...
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