(b). Prepared the paid-in capital portion of the stockhoder\'s equety section at

Question

(b). Prepared the paid-in capital portion of the stockhoder's equety section at Dec 31, 2014.

Problem 11-1A Tidwell Corporation was organized on January 1, 2014. It is authorized to issue 23,200 shares of 6%, $51 par value preferred stock and 495,800 shares of no-par common stock with a stated value of $2 per share. The following stock transactions were completed during the first year Jan. 10 Issued 67,200 shares of common stock for cash at $6 per share. Mar. 1 Issued 12,800 shares of preferred stock for cash at $55 per share May 1 Issued 134,000 shares of common stock for cash at $7 per share. Sept. 1 Issued 6,000 shares of common stock for cash at $4 per share Nov. 1 Issued 2,600 shares of preferred stock for cash at $54 per share.

Explanation / Answer

(a) Jounal Entries are as below:

Jan 10 : Cash                                Dr ($6*67200) $403200

             To Common stock                  ($2*67200) $134400

             To Capital in Excess of par                     $268800

(Being 67200 shares issued for cash @ $6 per share at a premium of $4 per share)

Mar 1 : Cash                                     Dr ($55*12800) $704000

           To Preferred Stock                       ($51*12800) $652800

           To Capital in Excess of par                             $51200

(Being 12800 preferred shares issued for cash at a premium of $4 per share)

May 1 : Cash                                Dr ($7*134000) $938000

             To Common stock                  ($2*134000) $268000

             To Capital in Excess of par                    $670000

(Being 134000 shares issued for cash @ $7 per share at a premium of $5 per share)

Sept 1: Cash                                Dr ($4*6000) $24000

             To Common stock                  ($2*6000) $12000

             To Capital in Excess of par                    $12000

(Being 134000 shares issued for cash @ $4 per share at a premium of $2 per share)

Nov 1: Cash                                     Dr ($54*2600) $140400

           To Preferred Stock                       ($51*2600) $132600

           To Capital in Excess of par                            $7800

(Being 2600 preferred shares issued for cash at a premium of $3 per share)

(b) Paid-in capital portion of the stockhoder's equity section at Dec 31, 2014:

Common Stock :

Authorized 495800 shares @ $2 each          991600

Issued    207200 shares @ $2 each                          414400

6% Preferred Stock:

Authorized 23200 shares @ $51 each        1183200

Issued    15400 shares @ $51 each                          785400

Capital in Excess of par

($268800 + $51200 +$670000 + $12000 + $7800)      1009800

Total of Stockholders capital                                     2209600

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