Rachael Ray Corporation had the following transactions. 1. Sold land (cost $12,000) for $15,000 2. Issued common

Question:

Rachael Ray Corporation had the following transactions.

1. Sold land (cost $12,000) for $15,000

2. Issued common stock for $20,000

3. Recorded depreciation of $17,000

4. Paid salaries of $9,000

5. Issued 1,000 shares of $1 par value common stock for equipment worth $8,000

6. Sold equipment (cost $10,000, accumulated depreciation $7,000) for $1,200

Instructions

For each transaction above,

(a) Prepare the journal entry, and

(b) Indicate how it would affect the statement of cash flows.

(For multiple debit/credit entries, list amounts from largest to smallest eg: 10, 5, 3, 2.)

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...