Question

Alpha Sounds Corp., an electric guitar retailer, was organized by Michele Kirby, Paul Glenn, and Gretchen Northway. The charter authorized 1,000,000 shares of common stock with a par of $1. The following transactions affecting stockholders’ equity were completed during the first year of operations:

a. Issued 100,000 shares of stock at par to Paul Glenn for cash.

b. Issued 3,000 shares of stock at par to Michele Kirby for promotional services provided in connection with the organization of the corporation and issued 45,000 shares of stock at par to Michele Kirby for cash.

c. Purchased land and a building from Gretchen Northway in exchange for stock issued at par. The land has a fair value of $60,000, and the building has a fair value of $120,000.

Answer 1

Alpha Sounds Corp. issued shares of stock to various individuals for cash and promotional services, and also exchanged stock for land and a building in a business transaction.

Step-by-step explanation:

In the given scenario, Alpha Sounds Corp. issued 100,000 shares of stock at par to Paul Glenn for cash and 3,000 shares of stock at par to Michele Kirby for promotional services provided in connection with the organization of the corporation.

They also issued 45,000 shares of stock at par to Michele Kirby for cash. Furthermore, the corporation purchased land and a building from Gretchen Northway in exchange for stock issued at par.

In this case, the subject is Business and the grade level is College.