Question

The charter for

WXYZ minus TVWXYZ−TV​,

Inc. authorizes the company to issue​ 100,000 shares of

​$4

​no-par preferred stock and​ 500,000 shares of common stock with​ $1 par value. During its​ start-up phase,

WXYZ minus TVWXYZ−TV

completed the following​ transactions:

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.

Requirement 1. Record the transactions in the general journal. ​(Record debits​ first, then credits. Select the explanation on the last line of the journal entry​ table.)

Sep.Sep.

​6: Issued

500500

shares of common stock to the promoters who organized the​ corporation, receiving cash of

​$15 comma 00015,000.

Date			Accounts and Explanation	Debit	Credit
Sep. 6			Cash	15,000
			Common Stock—$1 Par Value		500
			Paid-In Capital in Excess of Par—Common		14,500
			Issued common stock for cash.

Sep.Sep.

​12: Issued

350350

shares of preferred stock for cash of

​$28 comma 00028,000.

Date			Accounts and Explanation	Debit	Credit
Sep. 12			Cash	28,000
			Preferred Stock—No Par Value		28,000
			Issued preferred stock for cash.

Sep.Sep.

​14: Issued

1 comma 4001,400

shares of common stock in exchange for land with a market value of

​$20 comma 00020,000.

Date			Accounts and Explanation	Debit	Credit
Sep. 14			Land	20,000
			Common Stock—$1 Par Value		1,400
			Paid-In Capital in Excess of Par—Common		18,600
			Issued common stock for land.

Requirement 2. Prepare the​ stockholders' equity section of the

WXYZ minus TVWXYZ−TV

balance sheet at

SeptemberSeptember

3030​,

20182018​,

assuming

WXYZ minus TVWXYZ−TV​,

Inc. had net income of

$ 30 comma 000$30,000

for the month.

WXYZ-TV, Inc.

Balance Sheet (Partial)

September 30, 2018

Stockholders' Equity
	Paid-In Capital:
	Preferred Stock—$4, No-Par Value; 100,000 shares authorized,
	Common Stock—$1 Par Value; 500,000 shares authorized,	28000
	350 shares issued and outstanding
	Paid-In Capital in Excess of Par—Common	1900
	Paid-In Capital in Excess of Par—Common	18600
	Total Paid-In Capital	48500
	Retained Earnings	32000
	Total Stockholders' Equity	80500

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Sep. 6	Issued 500 shares of common stock to the promoters who organized the corporation,
	receiving cash of $15,000.
12	Issued 350 shares of preferred stock for cash of $28,000.
14	Issued 1,400 shares of common stock in exchange for land with a market value
	of $20,000.

Answer 1

Answer to Requirement 1. Credit Date Sep 6 Debit 15,000 500 14,500 Sep 12 28,000 Account Titles and Explanation Cash Common Stock - $1 Par Value (500 * $1) Paid-in Capital in excess of Par - Common Stock (Issued Common Stock for cash) Cash Preferred Stock - no Par Value (Issued Preferred Stock for cash) Land Common Stock - $1 Par Value (1,400 * $1) Paid-in Capital in excess of Par - Common Stock (Issued Common Stock for Land) 28,000 Sep 14 20,000 1,400 18,600

28,000 WXYZ - TV, Inc. Balance Sheet (Partial) September 30, 2018 Stockholders' Equity: Capital Stock: Preferred Stock - $4, No Par Value; 100,000 Shares Authoized; 350 Shares Outstanding Common Stock - $1 Par Value; 500,000 Shares Authorized; 1,900 Shares Outstanding Total Capital Stock Paid-in Capital in Excess of Par: Paid-in Capital in excess of Par-Common Stock Total Paid-in Capital in excess of Par Total Paid-in Capital Retaind Earnings Total Stockholders' quity 1,900 29,900 33,100 33,100 63,000 30,000 93,000