Effect of issuing common stock on the balance sheet

Newlv formed Home Medical Corporation has 100.000 shares of S5 par common stock autho-

rized. On March 1. 2011. Home Medical issued 10.000 shares of the stock for $12 per share. On

May 2 the company issued an additional 20,000 shares for >20 per share. Home Medical was not

allected by other events during 2011

Required

Record the transactions in a horizontal statements model like the following

one In the Cash

Flow column.

indicate whether the item IS an operating activity (OA). investing activity (IA).

(PA) Use NA to indicate that an element was not attected ov the event

Liah

Rev.

Exp.

Net InC

Cash Flow

Cash

Equitv

Com. Stk.

+ PIC in Excess

Proprietorships, Partnerships, and Corporations

Determine the amount Home Medical would report for common stock on the December 31.

201. balance sheet.

Determine the amount Home Medical would report for paid-in capital in excess of par.

What is the total amount of capital contributed by the owners?

What amount of total assets would Home Medical report on the December 31.2011. balance

sheet?

f. Prepare journal entries to record the March I and May 2 transactions.