P 20-8A (L03) (a) Cr. Paid-In Capital in Excess of Par- Common Stock: $5,000 CLG

Question

P 20-8A (L03) (a) Cr. Paid-In Capital in Excess of Par- Common Stock: $5,000 CLGL STOCK SUBSCRIPTIONS Juneau & Associates had the following stock transactions during the year: (a) Received subscriptions for 100,000 shares of $1 par common stock for $105,000. (b) Received subscriptions for 5,000 shares of $15 par, 8% preferred stock for $80,000 (c) Received a payment of $55,000 on the (d) Received a payment of $40,000 on the (e) Issued 40,000 shares of $1 par common common stock subscription. preferred stock subscription. stock in exchange for a truck with a fair market value of $48,000. (f) Received the balance in full for the common stock subscription and issued the stock 808

Explanation / Answer

Journal Entries :-

S.No. Particulars Debit($) Credit($) a) Application for Common Stock A/c Dr. 105000 To Common stock A/c 100000 To Paid in Capital excess of Par 5000 b) Application for 8% Preferred Stock A/c Dr. 80000   To 8% Preferred Stock A/c 75000 To Paid in Capital Excess of Par 5000 c) Cash A/c Dr. 55000 To Application for Common Stcok 55000 d) Cash A/c Dr. 40000 To Application for 8% Preferred Stock A/c 40000 e) Truck a/c Dr. 48000 To Common Stcok A/c 40000 To Paid in Capital Excess of Par 8000 f) Cash A/c Dr. ($105000 - $55000) 50000 To Application for Common Stock A/c 50000 g) Cash A/c Dr. ($80000 - $40000) 40000 To Application for 8% Preferred Stock 40000

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