Question

During its first year of operations, foyle corporation had the following transactions about its common stock. jan. 10 issued 70,000 shares for cash at $5 per share. july 1 issued 40,000 shares for cash at $7 per share. instructions journalize the transactions, assuming that the common stock has a par value of $5 per share. journalize the transactions, assuming that the common stock is no-par with a stated value of $1 per share. journalize issuance of common stock.

Answer 1

To journalize the issuance of common stock with a par value or no-par value with stated value, you would record the transactions in the general journal by debiting cash and crediting common stock.

Step-by-step explanation:

To journalize the issuance of common stock, we need to record the transactions in the general journal. Assuming that the common stock has a par value of $5 per share:

1. January 10: Debit Cash $350,000 and Credit Common Stock $350,000 (70,000 shares x $5 per share)
2. July 1: Debit Cash $280,000 and Credit Common Stock $280,000 (40,000 shares x $7 per share)

Assuming that the common stock is no-par with a stated value of $1 per share:

1. January 10: Debit Cash $350,000 and Credit Common Stock $350,000 (70,000 shares x $1 per share)
2. July 1: Debit Cash $280,000 and Credit Common Stock $280,000 (40,000 shares x $1 per share)