DeLong Corporation was organized on January 1, 2017. It is authorized to issue 1

Question

DeLong Corporation was organized on January 1, 2017. It is authorized to issue 10,000 shares of 8%, $100 par value preferred stock, and 500,000 shares of no-par common stock with a stated value of $2 per share. The following stock transactions were completed during the first year.

Journalize the following transactions

Jan. 10 Issued 80,000 shares of common stock for cash at $4 per share. Mar. 1 Issued 5,000 shares of preferred stock for cash at $105 per share. Apr. 1 Issued 24,000 shares of common stock for land. The asking price of the land was $90,000. The fair value of the land was $85,000. May 1 Issued 80,000 shares of common stock for cash at $4.5 per share. Aug. 1 Issued 10,000 shares of common stock to attorneys in payment of their bill of $30,000 for services performed in helping the company organize. Sept. 1 Issued 10,000 shares of common stock for cash at $5 per share. Nov. 1 Issued 1,000 shares of preferred stock for cash at $109 per share.

Explanation / Answer

Date Debit $ Credit $ Jan 10 Cash A/c Dr 320,000 To Common Stock 160,000 To paid in capital in excess of par - common 160,000 Mar 1 Cash A/c Dr 525,000 To Prefered Stock 500,000 To paid in capital in excess of par - preffered 25,000 Apr 1 Land A/c Dr 90,000 To Common stock 48,000 To paid in capital in excess of par - common 42,000 May 1 Cash A/c Dr 360,000 To Common stock 160,000 To paid in capital in excess of par - common 200,000 Aug 1 Profession Service Expenses A/c Dr 30,000 To Common stock 20,000 To paid in capital in excess of par - common 10,000 Sept 1 Cash A/c Dr 50,000 To Common stock 20,000 To paid in capital in excess of par - common 30,000 Nov 1 Cash A/c Dr 109,000 To Prefered Stock 100,000 To paid in capital in excess of par - preffered 9,000

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