Question

Presented below is information related to Skysong Company:

1.		The company is granted a charter that authorizes issuance of 15,000 shares of $100 par value preferred stock and 40,000 shares of no-par common stock.
2.		8,500 shares of common stock are issued to the founders of the corporation for land valued by the board of directors at $290,000. The board establishes a stated value of $10 a share for the common stock.
3.		5,500 shares of preferred stock are sold for cash at $110 per share.
4.		The company issues 170 shares of common stock to its attorneys for costs associated with starting the company. At that time, the common stock was selling at $55 per share.

No.	Account Titles and Explanation	Debit	Credit
(a)
(b)
(c)
(d)

Answer 1

No.	Account Titles and Explanation	Debit	Credit
(a)	No Journal entry
(b)	Land	290000
	Common Stock		85000
	Paid in capital in excess of stated value-Common Stock		205000
(c)	Cash (5500*110)	605000
	Preferred stock		550000
	Paid in capital in excess of par-Preferred stock		55000
(d)	Attorney's fees (170*55)	9350
	Common Stock		1700
	Paid in capital in excess of stated-Common Stock		7650