Grouper Corp. was organized on January 1, 2017. It is authorized to issue 22,000

Question

Grouper Corp. was organized on January 1, 2017. It is authorized to issue 22,000 shares of 6%, $53 par value preferred stock and 456,000 shares of no-par common stock with a stated value of $1 per share. The following stock transactions were completed during the first year.

(a)

Journalize the transactions.

Grouper Corp. was organized on January 1, 2017. It is authorized to issue 22,000 shares of 6%, $53 par value preferred stock and 456,000 shares of no-par common stock with a stated value of $1 per share. The following stock transactions were completed during the first year.

Jan. 10 Issued 68,000 shares of common stock for cash at $6 per share. Mar. 1 Issued 1,160 shares of preferred stock for cash at $56 per share. May 1 Issued 113,000 shares of common stock for cash at $7 per share. Sept. 1 Issued 4,600 shares of common stock for cash at $4 per share. Nov. 1 Issued 2,600 shares of preferred stock for cash at $57 per share.

Explanation / Answer

(a)

Date

General Journal

Debit

Credit

10-Jan

Cash (68,000 x $ 6)

$                408,000

Common Stock (68,000 x $ 1)

$              68,000

Paid-in Capital in Excess of Stated value-

Common Stock (68,000 x $ 5)

$            340,000

The Common stock of face value $1 is issued for $6

1-Mar

Cash (1,160 x $ 56)

$                  64,960

Preferred Stock (1,160 x $ 53)

$              61,480

Paid-in Capital in Excess of Stated value-

Preferred Stock (1,160 x $ 3)

$                3,480

The Preferred stock of face value $53 is issued for $56

1-May

Cash (113,000 x $ 7)

$                791,000

Common Stock (113,000 x $ 1)

$            113,000

Paid-in Capital in Excess of Stated value-

Common Stock (113,000 x $ 6)

$            678,000

The common stock of face value $1 is issued for $7

1-Sep

Cash (4,600 x $ 4)

$                  18,400

Common Stock (14,600 x $ 1)

$                4,600

Paid-in Capital in Excess of Stated value-

Common Stock (4,600 x $ 3)

$              13,800

The common stock of face value $1 is issued for $4

1-Nov

Cash (2,600 x $ 57)

$                148,200

Preferred Stock (2,600 x $ 53)

$            137,800

Paid-in Capital in Excess of Stated value-

Preferred Stock (2,600 x $ 4)

$              10,400

The Preferred stock of face value $53 is issued for $57

Date

General Journal

Debit

Credit

10-Jan

Cash (68,000 x $ 6)

$                408,000

Common Stock (68,000 x $ 1)

$              68,000

Paid-in Capital in Excess of Stated value-

Common Stock (68,000 x $ 5)

$            340,000

The Common stock of face value $1 is issued for $6

1-Mar

Cash (1,160 x $ 56)

$                  64,960

Preferred Stock (1,160 x $ 53)

$              61,480

Paid-in Capital in Excess of Stated value-

Preferred Stock (1,160 x $ 3)

$                3,480

The Preferred stock of face value $53 is issued for $56

1-May

Cash (113,000 x $ 7)

$                791,000

Common Stock (113,000 x $ 1)

$            113,000

Paid-in Capital in Excess of Stated value-

Common Stock (113,000 x $ 6)

$            678,000

The common stock of face value $1 is issued for $7

1-Sep

Cash (4,600 x $ 4)

$                  18,400

Common Stock (14,600 x $ 1)

$                4,600

Paid-in Capital in Excess of Stated value-

Common Stock (4,600 x $ 3)

$              13,800

The common stock of face value $1 is issued for $4

1-Nov

Cash (2,600 x $ 57)

$                148,200

Preferred Stock (2,600 x $ 53)

$            137,800

Paid-in Capital in Excess of Stated value-

Preferred Stock (2,600 x $ 4)

$              10,400

The Preferred stock of face value $53 is issued for $57

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