Miller Enterprises is a national chain of upscale bicycle shops. The company has followed a successful strategy of locating near major universities. Miller has the opportunity to expand into several new markets but must raise additional capital. The company has engaged in the following transactions:

Issued 56,000 additional shares of common stock. The stock has a par value of $2 and sells in the market for $27 per share.

Issued bonds. These bonds have a face value of $810,000 and mature in 11 years. The bonds pay 12 percent interest, semiannually. The current market rate of interest is 10 percent.

1.

Record the sale of the bonds

General Journal Debit Credit

Cash

bonds payable

premium on bonds payable

2. Record the issuance of the stock

General Journal Debit Credit

cash

capital in excess of par common stock

common stock