Please answer questions and placeon the guidance report using the May-June numbers. Let me know if you have questions or issues.

Chapter 2 Exercise 1 Issuance of stock Prepare journal entries to record the issuance of 100,000 shares of common stock at $20 per share for each of the following independent cases: a. Jackson Corporation has common stock with a par value of $1 per share. b. Royal Corporation has no-par common with a stated value of $5 per share. c. French Corporation has no-par common; no stated value has been assigned. Chapter 2 Exercise 3 Analysis of stockholders' equity Star Corporation issued both common and preferred stock during 20X6. The stockholders' equity sections of the company's balance sheets at the end of 20X6 and 20X5 follow: 20X6 Preferred stock, $100 par value, 10% Common stock, $10 par value $ 580,000 20X5 $ 500,000 2,350,000 1,750,000 Preferred 24,000 Common 4,620,000 3,600,000 Retained earnings 8,470,000 6,920,000 $16,044,000 $12,770,000 Paid-in capital in excess of par value Total stockholders' equity a. Compute the number of preferred shares that were issued during 20X6. b. Calculate the average issue price of the common stock sold in 20X6. c. By what amount did the company's paid-in capital increase during 20X6? d. Did Star's total legal capital increase or decrease during 20X6? By what amount? Chapter 2 Problem 3 Issuance of stock Ventures Inc. was formed on January 1 to invest in artwork. The company is authorized to issue 10,000 shares of $1 par-value common stock and 1,000 shares of 10%, $50 par-value cumulative preferred stock. The following selected transactions occurred during the first quarter of operation: Jan. 3 Sold 5,000 shares of common stock to the corporation's founders at $30 per share. 19 Sold 600 shares of preferred stock at $58 per share. Feb. 4 Issued 100 common shares to an attorney for $3,300 of legal work related to corporate start-up and formation. 11 1. Issued 2,000 shares of common stock to Pierre LaTour in exchange for a painting appraised at $75,000. The art originally cost LaTour $30,000. Instructions a. Prepare journal entries to record the company's transactions. b. Prepare the stockholders' equity section of the firm's March 31 balance sheet. The Retained Earnings balance on this date totals $41,000. c. The president of Ventures believes that organization costs should be expensed immediately. Briefly explain why the president's view is incorrect. Chapter 3 Exercise 4 1. Basic manufacturing computations Lyon Manufacturing reported total manufacturing costs (direct materials used, direct labor, and factory overhead) of $549,000 for 20X3. Sales and operating expenses were $759,200 and $142,500, respectively. The following information appeared on company balance sheets: For the Year Ended 12/31/X3 Finished goods $150,000 $153,700 86,400 74,100 Work in process 2. 12/31/X2 Compute cost of goods manufactured, cost of goods sold, and net income for 20X3. Chapter 3 Problem 2 Straightforward manufacturing statements The following information was extracted from the accounting records of Olympic Company for the year just ended: Sales $628,000 Work in process, Jan. 1 56,700 Advertising expense 23,500 Direct material purchases Finished goods, Dec. 31 231,500 67,800 1. Indirect materials used 12,300 Direct labor 85,600 Direct materials, Jan. 1 45,500 Finished goods, Jan. 1 55,900 Direct materials, Dec. 31 38,200 Sales staff salaries 33,300 Work in process, Dec. 31 47,400 Indirect labor 50,700 Utilities, taxes, insurance, and depreciation are incurred jointly by Olympic's manufacturing, sales, and administrative facilities. The costs were as follows: Utilities 2. $40,000 Taxes 25,000 Insurance 10,000 Depreciation 36,000 The first three costs are allocated proportionately on the basis of square feet occupied by the three functional areas. A review of the company's facilities revealed the following percentages would be appropriate: manufacturing, 50%; sales, 30%; and administrative, 20%. Depreciation is allocated 70, 20, and 10%, respectively. 3. Instructions a. Prepare a schedule of cost of goods manufactured in good form. b. Prepare an income statement in good form. Ashf LISTEN TO AUDIO/VIDEO EXPLAINING THE GUIDANCE REPORT Exercise/ Problem Account to be changed Shares Share price $ Original Amount 100000 20 Ch 2 Ex 1 Questions YOUR ANSWERS BASED UPON COURSE START DATE A. Cash Common stock Paid-in-capital B. Cash Common stock Paid-in-capital C. Cash Common stock Ch 2 EX 3 Account to be changed Preferred stock, $100 par value, 10% Common par Original Amount 580000 10 YOUR ANSWERS BASED UPON COURSE START DATE A. Preferred shares issued B. Shares issued of common B. Average issued price of common C. Paid-in-capital increase D. Legal capital increase Ch 2 Pb 3 Account to be changed Jan 3, Common Shares sold Share price Attoney cost Original Amount 5000 58 3300 YOUR ANSWERS BASED UPON COURSE START DATE 3-Jan Cash Common stock Paid-in-capital in excess of par common stock Jan. 19 Cash Preferred stock Paid-in-capital in excess of par- Preferred stock 4-Feb Organization costs Common stock Paid-in-capital in excess of par common stock Investment in art work Common stock Paid-in-capital in excess of par common stock Stockholders Equity Common stock, $1 par-value, authorized 10,000 shares, shares issued and outstanding Preferred stock,10%, $50 par, authorized 1000 shares shares issued and outstanding Total Capital Stock Paid-in-Capital in excess of par: Common stock Preferred stock Total Paid-in-Capital Retained earnings Total Shareholders Equity Ch3 Ex 4 Account to be changed Original Amount 549000 759200 Manufacturing costs Sales YOUR ANSWERS BASED UPON COUR Cost of goods manufactured Beginning work in process Manufacturing costs Ending work in process Cost of goods manufactured Cost of goods sold Beginning finished goods Cost of goods manufactured Ending finished goods Cost of goods sold Net income Sales Cost of goods sold Operating expenses Net income Ch 3 Pb 2 Account to be changed Original Amount 628000 56700 23500 231500 Sales Work in process, Jan. 1 Advertising expense Direct material purchases YOUR ANSWERS BASED UPON COURSE START DATE a. Prepare a schedule of cost of goods manufactured in good form. Direct materials used Beginning raw materials inventory Net purchases Direct materials available Less: Ending raw materials inventory Direct materials used Direct labor Factory overhead Indirect materials used Indirect labor Utilities Taxes Insurance Depreciation Total manufacturing costs Add: Beginning work in process inventory Less: Ending work in process inventory Costs of goods manufactured Sales Cost of goods sold Beginning finished goods inv. Cost of goods manufactured Goods available for sale Less: Ending finished goods inv. Cost of goods sold Gross profit Operating expenses: Selling expenses: Advertising Sales staff salaries Utilities Taxes Insurance Depreciation Total selling expenses Administrative expenses: Utilities Taxes Insurance Depreciation Total administrative exp. Total operating expenses Net income Ashford University ACC206 Guidance Report Week Two YELLOW INDICATES ACCOUNT AMOUNTS CHANGED Change Account to: Based Upon Course Start Date Jan-Feb $ 500000 20X6 600,000 11 Mar-Apr 11000 21 20X5 500,000 $ 20X6 620,000 12 May-Jun 12000 22 20X5 500,000 20X6 640,000 13 5,200 62 3,600 5,400 66 3,900 5,600 70 4,200 12/31/X3 551,000 761,600 12/31/X2 12/31/X3 553,000 764,000 12/31/X2 12/31/X3 555,000 766,400 NSWERS BASED UPON COURSE START DATE 629000 57700 24500 232500 630000 58700 25500 233500 631000 59700 26500 234500 May-Jun $ Jul-Aug 13000 23 20X5 500,000 $ 20X6 660,000 14 Sept-Oct 14000 24 20X5 500,000 $ 20X6 680,000 15 Nov-Dec 15000 25 20X5 500,000 $ 100000 26 20X6 20X5 $ 700,000 $ 500,000 $ 16 5,800 74 4,500 6,000 78 4,800 6,200 82 5,100 12/31/X2 12/31/X3 557,000 768,800 632000 60700 27500 235500 12/31/X2 12/31/X3 559,000 771,200 633000 61700 28500 236500 12/31/X2 12/31/X3 561,000 773,600 634000 62700 29500 237500 12/31/X2