Question

Question 10 Presented below is information related to Sheffield 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. 9,500 shares of common stock are issued to the founders of the corporation for land valued by the board of directors at $310,000. The board establishes a stated value of $10 a share for the common stock. 3. 6,200 shares of preferred stock are sold for cash at $110 per share. 4. The company issues 150 shares of common stock to its attorneys for costs associated with starting the company. At that time, the common stock was selling at $60 per share. Prepare the general journal entries necessary to record these transactions. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts.) No. Account Titles and Explanation Debit Credit (a) (b) (c)

Answer 1

Account Titles and Explanation Debit Credit No. (a) No entry (b) $310,000 (c) $682,000 Land Common stock Paid in capital in excess of stated value - Common stock Cash Preferred stock Paid in capital in excess of par value - Preferred stock Organisation costs Common stock $95,000 9,500*$10 $215,000 6,200*$110 $620,000 6,200*$100 $62,000 6,200*$10 (d) $9,000 $9,000 150*$60