Stock issuance (Learning Objectives 3 & 7) 10–15 min.

The charter for Zoom, Inc., authorizes the company to issue 900,000 shares of $3, nopar preferred stock and 1,400,000 shares of common stock with $6 par value. During its start-up phase, Zoom, Inc., completed the following transactions:

2012 Oct 6 12 14 Issued 300 shares of common stock to the promoters who organized the corporation, receiving cash of $9,000.

Issued 500 shares of preferred stock for cash of $26,000.

Issued 1,600 shares of common stock in exchange for land with a market value of $18,000.

Requirements 1. Record the transactions in the journal.

2. Prepare the stockholders’ equity section of the Zoom’s balance sheet at December 31, 2014. Assume that the company earned net income of $32,000 during this period.

AppendixLO1