Exercise 11-2 Date Account Titles and Explanation Debit Credit Exercise 11-2 Alo
ID: 2591551 • Letter: E
Question
Exercise 11-2
Date
Account Titles and Explanation
Debit
Credit
Exercise 11-2
Aloue Corp., a publicly traded company, had 2,400 preferred shares issued with a balance of $55,200 and 147,000 common shares issued with a balance of $735,000 at the beginning of the year. The following share transactions occurred during the year:June 12 Issued 47,700 common shares for $6 per share. July 11 Issued 1,100 preferred shares for $25 per share. Oct. 1 Issued 9,900 common shares in exchange for land. The common shares were trading for $7 per share on that date. The fair value of the land was estimated to be $73,800. Nov. 15 Issued 26,200 preferred shares for $29 per share.
Explanation / Answer
PART A face value of preferred stock = 55200/2400 = 23 face value of common stock = 735000/147000 = 5 Jun-12 cash 286200 (47700*6) common stock 238500 (47700*5) paid-in excess of par - common stock 47700 (47700*1) Jul-11 cash 27500 (1100*25) preferred stock 25300 (1100*23) paid-in excess of par - preferred stock 2200 (1100*2) Oct-01 land 69300 (9900*7) common stock 49500 (9900*5) paid-in excess of par - common stock 19800 (9900*2) Nov-15 cash 759800 (26200*29) preferred stock 655000 (26200*25) paid-in excess of par - preferred stock 104800 (26200*4) PART B Number of shares Balance in accounts 1. preferred stock 29700 735500 (2400+1100+26200) (55200+25300+655000) 2.common shares 204600 1023000 (147000+47700+9900) (735000+238500+49500)
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