Question $8$

Spangler Corporation's charter allows it to issue $25,000$ shares of $$100$ par preferred stock

and $50,000$ shares of $$20$ par common stock. The company had the following stock

transactions during the past year:

Issued $10,000$ shares of common stock to the corporate founders in exchange for a

building valued at $$150,000$ and equipment valued at $$75,000.$

Sold $500$ shares of preferred stock at $$125$ per share and $1\mathrm{.}000$ shares of common stock

at par to an investor.

Sold $5,000$ shares of common stock for $$35$ per share.

Issued $2,000$ shares of common stock with a market value of $$40$ per share, and $750$

shares of preferred stock with a market value of $$145$ per share, for a lump sum of

$$200,000.$

Purchased at $$25$ per shire, $2,000$ shares of Spangler Corporation common stock.

Sold $1,000$ shares of treasury stock at $$30$ per share.

Sold $1,000$ shares of treasury stock at $$18$ per share.

Instructions:

Prepare journal entries for the transactions noted above. No other transactions have

affected the stock accounts. Record all lump sum transactions using the proportional

method and all treasury stock transactions using the cost method.

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