Stock transaction for corporate expansion Obj. 2 Pulsar Optics produces medical lasers for use in hospitals. The accounts and their balances appear in the ledger of Pulsar Optics on April 30 of the current year as follows:

Preferred 1% Stock, $120 par (300,000 shares authorized, 36,000 shares issued) . . . . . . . . $ 4,320,000 Paid-In Capital in Excess of Par—Preferred Stock. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 180,000 Common Stock, $15 par (2,000,000 shares authorized, 1,400,000 shares issued) . . . . . . . . 21,000,000 Paid-In Capital in Excess of Par—Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,500,000 Retained Earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78,000,000 At the annual stockholders’ meeting on August 5, the board of directors presented a plan for modernizing and expanding plant operations at a cost of approximately $9,000,000. The plan provided

(a) that the corporation borrow $1,500,000,

(b) that 20,000 shares of the unissued preferred stock be issued through an underwriter, and

(c) that a building, valued at $4,150,000, and the land on which it is located, valued at $800,000, be acquired in accordance with preliminary negotiations by the issuance of 300,000 shares of common stock. The plan was approved by the stockholders and accomplished by the following transactions:

Oct. 9. Borrowed $1,500,000 from St. Peter City Bank, giving a 4% mortgage note.

17. Issued 20,000 shares of preferred stock, receiving $126 per share in cash.

28. Issued 300,000 shares of common stock in exchange for land and a building, according to the plan.

Instructions Journalize the entries to record the October transactions.

AppendixLO1