After operating as a partnership for several years, Temika Clark and Terry Fries

Question

After operating as a partnership for several years, Temika Clark and Terry Friesen decided to incorporate their b Modern to issue 150,000 shares of $1.00 stated-value common stock Landscapes. The new corporation received its charter on March 31 of the current year. The corporation is authorized and 50,000 shares of 8%, $100.00 par-value preferred stock. Instructions: Journalize the following transactions. A general journal and a cash receipts journal are provided in the Working Papers. Source documents are abbreviated as follows: m emorandum, M; receipt, R. Transactions: Received cash from Temika Clark for 10,000 shares of common stock at $5.00 per share, $50,000.00. Receipt No. 1. Received cash from Harris Financial Advisors for 800 shares of preferred stock at par value. Receipt No. 2. Received cash from Terry Friesen for 25,000 shares of common stock at $5.00 per share, $125,000.00. Receipt No. 3. Received equipment from Marshall Glenn at an agreed-upon value of $27,600.00 in exchange for 250 shares of preferred stock. M3. Received cash from State Retirement Fund for 500 shares of preferred stock at $103.00 per share, $51,500.00. Receipt No. 16 Apr. 1. 2. 3. 4. 28.

Explanation / Answer

Date Particulars Debit Credit Apr-01 Cash A/c $     50,000.00 Common Stock A/c $     10,000.00 Additional paid in Capital A/c - Common Stock $     40,000.00 (Common stock issued at premium) Apr-02 Cash A/c $     80,000.00 8% Preffered Stock A/c $     80,000.00 (Preffered stock issued at par) Apr-03 Cash A/c $ 1,25,000.00 Common Stock A/c $     25,000.00 Additional paid in Capital A/c - Common Stock $ 1,00,000.00 (Common stock issued at premium) Apr-04 Equipment A/c $     27,600.00 8% Preffered Stock A/c $     25,000.00 Additional paid in Capital - Preffered Stock $       2,600.00 (Preffered stock issued at premium against equipment) Apr-28 Cash A/c $     51,500.00 8% Preffered Stock A/c $     50,000.00 Additional paid in Capital - Preffered Stock $       1,500.00 (Preffered stock issued at par)

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