Question

Work Place Products Inc., a wholesaler of office products, was organized on July 1 of the current year, with an authorization of 26,000 shares of preferred 2% stock, $100 par and 600,000 shares of $10 par common stock. The following selected transactions were completed during the first year of operations:

July	1	Issued 200,000 shares of common stock at par for cash.
	1	Issued 400 shares of common stock at par to an attorney in payment of legal fees for organizing the corporation.
Aug.	7.	Issued 66,200 shares of common stock in exchange for land, buildings, and equipment with fair market prices of $149,800, $474,380 and $163,600 respectively.
Sept.	20.	Issued 19,400 shares of preferred stock at $107 for cash.

Journalize the transactions. Refer to the Chart of Accounts for exact wording of account titles.

Answer 1

Journal entry

Date	account and explanation	Debit	Credit
July 1	Cash	2000000
	Common Stock		2000000
July 1	Organization expense	4000
	Common Stock		4000
Aug 7	Land	149800
	Building	474380
	Equipment	163600
	Common Stock		662000
	Paid in capital in excess of par value-Common Stock		125780
Sep 20	Cash (19400*107)	2075800
	Preferred stock		1940000
	Paid in capital in excess of par value-Preferred stock		135800