pulse or optics produces medical laser for use in hospitals the accounts and the
ID: 2445484 • Letter: P
Question
pulse or optics produces medical laser for use in hospitals the accounts and their balances appear in the ledger of pulsar optics on April 30 of the current year as follows
Preferred 1% stock $120 par 300,000 shares authorized 36,000 shares issued..... 4,320,000
Paid in capital in excess of par preferred stock ...180,000
common stock $15 par 2 million shares authorized 1,400,000 shares issued... 21,000,000
Paid in capital in excess of par common stock.... 3,500,000
Retained earnings 78,000,000
At the annual stockholders meeting is on August 5 the Board of Directors presented a plan for modernizing and expanding plant operations at a cost of approximately $9 billion the plan provided a that the corporation borrow one 1,500,000, b) that 20,000 shares of the unissued preferred stock be issued throughout the underwriter and c) that a building valued at $4,150,000 and the land on which is located valued at 800,000 be acquired in accordance with preliminary negotiations by the issuance of 300,000 shares of common stock the plan was approved by the stockholders and accomplished by the following transactions
October 9 borrow $1,000,500 from Saint Peter Citibank giving a 4% mortgage note
October 17 issue 20,000 shares of preferred stock receiving $126 per-share in cash
October 28 issued 300,000 shares of common stock in exchange for land and a gilding according to the plan
The instructions are to journalize the entries to record the October transactions
Explanation / Answer
Pulse or optics Journal Entries Date Account Title Dr $ Cr $ Oct 09. Cash 1,000,500 Notes Payable 1,000,500 (borrowing from Citibank) Oct 17. Cash 2,520,000 Preferred Stock 2,400,000 Paid in Capital in excess of Par-Preferred Stock 120,000 (issue of preferred share at premium of $6 per share) Oct 28. Building 4,150,000 Land 800,000 Common Stock 4,500,000 Paid in Capital in excess of Par-Common Stock 450,000 (issuance of common stock at premium of $1.5 per share in exchange of land and building)
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