Gilmore Company has 20,000 authorized shares of common stock, $2 par, and 20,000 authorized shares of pre-

ferred stock, $10 par. On April 10, 2020, Gilmore sold 600 shares of common stock and 400 shares of preferred

stock in one transaction for a total cash price of $20,000. The common stock recently had been selling at $26 per

share while the preferred stock recently had been selling at $16 per share.

Required

a. Prepare the entry on April 10, 2020, for the issuance of common and preferred stock.

b. Assume instead that only the market price of the common stock is known ($26 per share). Prepare the entry

on April 10, 2020, for the issuance of common and preferred stock