Question

Exercise 11-12 Swifty Corporation recently hired a new accountant with extensive experience in accounting for partnerships. Because of the pressure of the new job, the accountant was unable to review his textbooks on the topic of corporation accounting. During the first month, the accountant made the following entries for the corporation's capital stock. May 2 Cash 183,600 183,600 10 Capital Stock (Issued 10,200 shares of $15 par value common stock at $18 per share) Cash Capital Stock (Issued 10,200 shares of $55 par value preferred stock at $65 per share) 663,000 663,000 15 Capital Stock 15,750 15,750 Cash (Purchased 1,050 shares of common stock for the treasury at $15 per share) Cash 31 4,800 Capital Stock Gain on Sale of Stock 3,000 1,800 (Sold 300 shares of treasury stock at $16 per share)

Answer 1

		Debit	Credit
May 2	Cash	183600
	Common Stock		153000	=10200*15
	Paid-in Capital in excess of par-Common Stock		30600
May 10	Cash	663000
	Preferred Stock		561000	=10200*55
	Paid-in Capital in excess of par-Preferred Stock		102000
May 15	Treasury Stock	15750
	Cash		15750
May 31	Cash	4800
	Treasury Stock		4500	=300*15
	Paid-in Capital from sale of Treasury Stock		300