In January 2014, Vanowski Corporation was organized and authorized to issue 2,000,000 shares of no-par common stock

Question:

In January 2014, Vanowski Corporation was organized and authorized to issue 2,000,000 shares of no-par common stock and 50,000 shares of 5 percent, $50 par value, noncumulative preferred stock. The stock-related transactions for the first year€™s operations follow.

Required
1. For each of these transactions, indicate the account numbers and dollar amounts (as shown in the example) for the account(s) debited and credited, using the account numbers that follow.
110 Cash
120 Land
121 Building
220 Dividends Payable
305 Preferred Stock
310 Common Stock
312 Additional Paid-in Capital
313 Paid-in Capital, Treasury Stock
340 Retained Earnings
341 Dividends
350 Treasury Stock, Common
510 Start-up and Organization Costs
2. Why is the stockholders€™ equity section of the balance sheet an important consideration in analyzing the performance of acompany?

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...