Alpha Sounds Corp., an electric guitar retailer, was organized by Michele Kirby, Paul Glenn, and Gretchen...

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Alpha Sounds Corp., an electric guitar retailer, was organized by Michele Kirby, Paul Glenn, and Gretchen Northway. The charter authorized 600,000 shares of common stock with a par of $50. The following transactions affecting stockholders equity were completed during the first year of operations. Journalize the entries to record the transactions. a. Issued 8,500 shares of stock at par to Paul Glenn for cash. b. (1) Issued 750 shares of stock at par to Michele Kirby for promotional services provided in connection with the organization of the corporation, and (2) issued 15,000 shares of stock at par to Michele Kirby for cash. c Purchased land and a building from Gretchen Northway in exchange for stock issued at par. The building is mortgaged for 1459,00 for 20 years at 7% and there is accrued interest of $8,500 on the mortgage note at the time of the purchase. It is agreed that the land is to be priced at $125,000 and the builiding at $685,000, and that Gretchen Northways equity will be exchanged for stock at par. The corporation agreed to assume responsibility for paying the mortgage ncte Previous Next Check My Work 4more Check My Work uses remaning

mentSessionLo gnment-takedinprogress faise res of stock at par to Michele Kirby for promotional services provided in connection with the organization of the corporation, and (2) iss 15,000 shares of stock at par to Michele Kirby for cash. C. Purchased land and a building from Gretchen Northway in exchange for stock issued at par. The building is mortgaged for $459,000 for 20 years at 7% and there is accrued interest of $8,500 on the mortgage note at the time of the purchase. It is agreed that the land is to be priced at $125,000 and the building at $685,000, and that Gretchen Northways equity will be exchanged for stock at par. The corporation agreed to assume responsibility for paying the mortgage ne and the accrued interest. If an amount box does not require an entry, leave it blank.

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Answer 1

Answer #1

a.	Cash (8500 x $50)	425000
	Common stock		425000

b.(1)	Organizational expenses (750 x $50)	37500
	Common stock		37500

(2)	Cash (15000 x $50)	750000
	Common stock		750000

c.	Land	125000
	Building	685000
	Common stock		342500
	Mortgage note payable		459000
	Interest payable		8500

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Answer 2

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