Question

Adam Company Inc. 2018. Journalize the ollowing transactions On J value of stock $10. uly 1", 2018 Adam Company issued 50,000 shares of common stock at $14 per share, par th Adam Company issued 500 shares of common stock at S 10 par value for legal services rendered by Start Your Company Right Inc. The stock was trading at S 12 per share. Aug.2nd, issued 1000 shares of common stock in exchange of land. The par value of stock is $10.The asking price of land is S 12,000 and the stock was trading at S 15 per share. Notes

Answer 1

Sr. No.	Date	Particulars	Ledger Folio	Debit Amount	Credit Amount
1.	July 1, 2018	Bank / Cash A/c                                                                                  Dr		7,00,000
		To Common Stock (Share Capital) A/c			5,00,000
		To Share Premium A/c			2,40,000
2. A	July 5, 2018	Legal Expenses A/c                                                                            Dr		6,000
		To Start Your Company Right Inc A/c (Creditor) A/c			6,000
2. B	July 5, 2018	Start Your Company Right Inc A/c (Creditor)                                Dr		6,000
		To Common Stock (Share Capital) A/c			5,000
		To Share Premium A/c			1,000
3.	July 1, 2018	Land A/c                                                                                               Dr		12,000
		To Common Stock (Share Capital) A/c			10,000
		To Share Premium A/c			2,000
4.	November 1,	Treasury Stock A/c                                                                             Dr		1,50,000
	2018	To Bank / Cash A/c			1,50,000
5.	November15,	Bank / Cash A/c                                                                                  Dr		51,000
	2018	To Treasury Stock A/c			45,000
		To Additional Paid In Capital A/c			6,000
6.	November30,	Bank / Cash A/c                                                                                  Dr		60,000
	2018	Additional Paid In Capital A/c                                                          Dr		6,000
		Retained Earnings A/c                                                                       Dr		9,000
		To Common Stock (Share Capital) A/c			75,000

Notes : With respect to Entry No 6, The total loss on Sale of Treasury Stock is $15,000 (75,000-60,000).The amount debited in Additional Paid In Capital Account is to the extent of amount of balance available in it which is $6,000 as per the previous entry 5. Thereafter the additional loss of $9,000 [(75,000-60,000)-6000] is debited to Retained Earnings Account.