Question

Problem 13-01A a-c (Part Level Submission) Avayal Corporation was organized on January 1, 2020. It is authorized to issue 10,000 shares of 8% $100 par value preferred stock, and 450,000 shares of no-par common stock with a stated value of $2 per share. The following stock transactions were completed during the first year. Jan. 10 Issued 75,000 shares of common stock for cash at $4 per share. Mar. 1 Issued 4,000 shares of preferred stock for cash at $105 per share. Apt. 1 Issued 22,000 shares of common stock for land. The asking price of the land was $85,000. The fair value of the land was $80,000. May 1 Issued 75,000 shares of common stock for cash at $4.25 per share. Aug. 1 Issued 10,000 shares of common stock to attorneys in payment of their bill of $35,000 for services performed in helping the company organize. Sept. 1 Issued 10,000 shares of common stock for cash at $5 per share. Nov. 1 Issued 1,000 shares of preferred stock for cash at $10 per share.

Answer 1

Credit Ayayai Corporation Journal entries Date Account 10-Jan Cash Common Stock Paid in Capital in Excess of Stated Value-Common Stock Debit $ 300,000 =75,000*4 =75,000*2 $ 150,000 $ 150,000 $420,000 1-Mar Cash Preferred Stock Paid in Capital in Excess of Par-Preferred Stock -4,000*105 =4,000*100 $ 400,000 $ 20,000 $ 80,000 1-Apr Land Common Stock Paid in Capital in Excess of Stated Value-Common Stock =22,000*2 $ 44,000 $ 36,000 $318,750 1-May Cash Common Stock Paid in Capital in Excess of Stated Value-Common Stock =75,000*4.25 =75,000*2 $ 150,000 $ 168,750 $ 35,000 1-Aug Organization expenses Common Stock Paid in Capital in Excess of Stated Value-Common Stock $ 20,000 $ 15,000 =10,000*2 $ 50,000 1-Sep Cash Common Stock Paid in Capital in Excess of Stated Value-Common Stock =10,000*5 =10,000*2 $ 20,000 $ 30,000 $ 108,000 1-Nov Cash Preferred Stock Paid in Capital in Excess of Par-Preferred Stock =1,000*108 =1,000*100 $ 100,000 $ 8,000

Date Ayayai Corporation T Accounts Date Debit Date Credit Preferred Stock 1-Mar $ 400,000 1-Nov $ 100,000 Debit Date Credit Common Stock 10-Jan $ 150,000 1-Apr $ 44,000 1-May $ 150,000 1-Aug $ 20,000 1-Sep $ 20,000 Bal. Bal. $ 500,000 Paid in Capital in Excess of Par-Preferred St 1-Mar $ 20,000 1-Nov $ 8,000 $ 384,000 Paid in Capital in Excess of Stated Value-Comm 10-Jan $ 150,000 1-Apr $ 36,000 1-May $ 168,750 1-Aug $ 15,000 1-Sep $ 30,000 Bal. $ 28,000 $ 399,750

Ayayai Corporation Balance Sheet Partial As of December 31, 2020 Paid in Capital Capital Stock Preferred Stock Common Stock Total Capital Stock Additional Paid in Capital Paid in Capital in Excess of Par-Preferred Stock Paid in Capital in Excess of Stated Value-Common Stock Total Additional Paid in Capital Total Stockholders Equity 500,000 384,000 884,000 28,000 399,750 427,750 1,311,750