Estefan Corp. is authorized by its charter from the state of Wisconsin to issue

Question

Estefan Corp. is authorized by its charter from the state of Wisconsin to issue 750 shares of preferred stock with a 7% dividend rate and a par value of $50 per share and 22,000 shares of common stock with a par value of $0.01 per share. On January 1, 2019, Estefan Corp. issues 250 shares of preferred stock at $55 per share and 12,100 shares of common stock at $13 per share.

Required:

Prepare the journal entry to record the issuance of the stock.

2019 Jan 1. Cash __________________

Preffered Stock 12,500

Additional Paid- In Capital - Preffered Stock 1,250

Common Stock 121

Additional Paid In Capital - Common Stock __________

HOW DO I FIND CASH & ADDITIONAL PAID IN CAPITAL?

Explanation / Answer

Date General Journal Debit Credit 2019 Jan 1 Cash $171,050 Preferred Stock $12,500 Additional Paid-In Capital - Preferred Stock $1,250 Common Stock $121 Additional Paid In Capital - Common Stock[12,100 * ($13 - $0.01) $157,179

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