Question

ILLUSTRATION 13-5 STATEMENT PRESENTATION OF STOCKHOLDERS EQUITY BOOMER-CORPORATION. Stockholders" equity Paid-in capital Capital stock 9% Preferred stock, $10 par value, ailable at $12, cumulative, 10,000 shares authorized, 5,000 shares issued and outstanding s 50.000 Common stock, no par. $4 stated value, 50,000 shares authorized, 40,000 shares issued, and 39,000 outstanding Total capital stock 160,000 210,000 Additional pald-in capital In excess of par value-preferred stock In excess of stated value-common stock240,000 $ 50,000 Total additional paid-in capital Total paid-in capital 290,000 300,000 800,000 Retained earnings Total paid-in capital and retained earnings Less: Treasury stock-common (1,000 shares) 15,000) Total stockholders' equity CONDENSED FORMAT: Frequently used in published annual reports with footnote disclosure of additional information.

question 1.preferred stock was issued with 4 stated value.do the journal entry and how much you sold it for
common stock was issued with 10 par value do the journal entry and how much u sold it fora

Answer 1

Answer

• Actually:
  --Common Stock is the one that has been issued at $ 4 stated value, and
  --Preferred Stock is the one that has been issued at $ 10 par value.
• The journal entries are provided below:

--For issue of $ 10 par Preferred Stock

Accounts title	Debit	Credit
Cash	$              550,000
Preferred Stock [5000 shares x $ 10 par]		$             500,000
Additional paid in capital in excess of Par - Preferred Stock		$               50,000
(Preferred Stock issued - 5000 shares)

--For issue of $ 4 stated value Common Stock

Accounts title	Debit	Credit
Cash	$              400,000
Common Stock [40000 shares x $ 4 stated value]		$             160,000
Additional paid in capital in excess of Par - Common Stock		$             240,000
(Common Stock issued - 40000 shares)