Question

Rent (131); Office Equipment (163);: Accounts Payable (201); Common StocR (307):319,3 View transaction list Journal entry worksheet 12 1 2 3 4 5 6 7 8 Brooks invested $195,000 cash along with $20,000 in office equipment in the company in exchange for common stock. Note: Enter debits before credits. Date General Journal Debit Credit Mar 01 Cash 195,000 Office equipment Common stock 20,000 215,000 Record entry Clear entry View general journal References eBook& Resources Worksheet Learning Objective: 02-C3 Describe a ledger and a chart of accounts Learning Objective: 02-P2

Answer 1

Date General Journal Debit Credit Mar. 01 Cash $195,000 $20,000 Office Equipment Common Stock $215,000 [$195,000 + $20,000] NOTE It is assumed that the common stocks are issued at par value as no specific information about par value per share of common stock is available in the question. Suppose, if it is assumed that par value per common share is $5 and Brooks is allotted 40,000 shares, then the entry should be: Date General Journal Mar. 01 Cash Debit Credit $195,000 $20,000 Office Equipment Common Stock Additional Paid-in-Capital in Excess of Par - Common shares x $5] $15,000 [Balancing figure]