Please review this sample problem and provide comments.

Wise Company had the following transactions. 1. Issued 7,000 shares of common stock with a stated value of $10 for $130,000. 2. Issued 2,000 shares of $100 par preferred stock at $108 for cash.

Instructions Prepare the journal entries to record the above stock transactions.

Solution 1. Cash 130,000 Common Stock 70,000 Paid-in Capital in Excess of Stated ValueCommon Stock 60,000

2. Cash 216,000 Preferred Stock 200,000 Paid-in Capital in Excess of ParPreferred Stock