Question

Prepare the issuer’s journal entry for each of the following separate transactions.

a. On March 1, Atlantic Co. issues 44,000 shares of $5 par value common stock for $302,000 cash.
b. On April 1, OP Co. issues no-par value common stock for $73,000 cash.
c. On April 6, MPG issues 2,300 shares of $15 par value common stock for $42,000 of inventory, $150,000 of machinery, and acceptance of a $92,000 note payable.

Answer 1

The answer is given below;

Step-by-step explanation:

a. Cash Dr.$302,000

Capital (44,000*5) Cr.$220,000

Paid in Capital in excess of par Cr.$82,000

b. Cash Dr.$73,000

Capital Cr.$73,000

c. Cash Dr.$42,000

Capital 2,300*15 Cr.$34,500

Paid in capital in excess of par Cr.$7,500

Machinery Dr.$150,000

Cash (150,000-92,000)Cr.$58,000

Note payable Cr.$92,000