Issuing stock

Professional Products Inc., a wholesaler of office products, was organized on February $5$ of the current year, with an authorization of $50,000$ shares of preferred $2\%$ stock, $$60$ par and $1,000,000$ shares of $$8$ par common stock. The following selected transactions were completed during the first year of operations:

Journalize the transactions.

If an amount box does not require an entry, leave it blank.

Question Content Area

Feb. $5.$ Issued $600,000$ shares of common stock at par for cash.

DateAccountDebitCredit

Feb. $5$

Feedback Area

Feedback

What is the company receiving and at what price is the stock being issued?

Question Content Area

Feb. $5.$ Issued $1,400$ shares of common stock at par to an attorney in payment of legal fees for organizing the corporation.

DateAccountDebitCredit

Feb. $5$

Feedback Area

Feedback

Recall that stock may be issued for reasons other than to receive cash. What are these shares paying for?

Question Content Area

Apr. $9.$ Issued $60,000$ shares of common stock in exchange for land, buildings, and equipment with fair market prices of $$200,000,$ $$310,000,$ and $$80,000,$ respectively.

DateAccountDebitCredit

Apr. $9$

Feedback Area

Feedback

Record the assets, and increase the common stock account by the par value of the shares. Record any amount above par in a separate paid$-$in capital equity account.

Recall that shares of stock can be issued to acquire assets. At what value must the preferred stock and common stock accounts be recorded?

Question Content Area

June $14.$ Issued $32,000$ shares of preferred stock at $$82$ for cash.

DateAccountDebitCredit

June $14$

Feedback Area

Feedback

What is the company receiving for issuing the shares? At what value do the common and preferred stock accounts have to be recorded?

Feedback Area

Feedback

Partially correct