Oregano Corporation’s charter authorizes the issuance of 1 million common shares and 500,000 preferred shares. The following transactions involving share issues were completed. Assume that Oregano follows IFRS and that each transaction is independent of the others.
1. Issued 4,200 common shares for machinery. The machinery had been appraised at $74,500, and the seller’s carrying amount was $58,600. The common shares’ most recent market price is $18 a share.
2. Voted a $6 dividend on both the 17,000 shares of outstanding common and the 40,000 shares of outstanding preferred. The dividend was paid in full.
3. Issued 2,500 shares of common and 1,200 shares of preferred for a lump sum of $125,000. The common had been selling at $13 and the preferred at $80. The company uses the relative fair value method to measure lump-sum share issues.
4. Issued 2,200 shares of common and 135 shares of preferred for furniture and fixtures. The common shares had a fair value of $14 per share and the furniture and fixtures were appraised at $36,000.
5. Issued a $150,000, 7% bond payable at par and gave as a bonus 150 preferred shares, which at that time were selling for $53 a share.
Instructions
Prepare the journal entries to record the transactions.