Question

During its first year of operations, Eastern Data Links Corporation entered into the following transactions relating to shareholders' equity. The articles of incorporation authorized the issue of 6 million common shares, $1 par per share, and 2 million preferred shares, $50 por per share. Feb. 12 Sold 3 million common shares, for $10 per share. 13 Issued 39,000 common shares to attorneys in exchange for legal services. 13 Sold 72,000 of its common shares and 6,000 preferred shares for a total of $1,635,000. Nov. 15 Issued 420,000 of its common shares in exchange for equipment for which the cash price was known to be $3,988,000. Required: Prepare the appropriate journal entries to record each transaction. (If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Enter your answers in whole dollars.) View transaction list Journal entry worksheet < 2 3 4 1 Sold 3 million common shares, for $10 per share. Note: Enter debits before credits Date General Journal Debit Credit February 12

Answer 1

S.no.	Particulars	Debit	Credit
1	Cash Dr (3,000,000*$10)	$30,000,000
	To Common stock (3,000,000*$1)		$3,000,000
	To Paid in Capital in excess of Par Value- Common Stock		$27,000,000
2	Organization Expense Dr (39,000*$10)	$390,000
	To Common stock (35000*$1)		$39,000
	To Paid in Capital in excess of Par Value- Common Stock		$351,000
3	Cash Dr	$1,035,000
	To Common stock (72,000*$1)		$72,,000
	To Paid in Capital in excess of Par Value- Common Stock (72,000*$9)		$648,000
	To Preferred stock (6,000*$50)		$300,000
	To Paid in Capital in excess of Par Value- Preferred Stock		$15,000
4	Equipment Dr	$3,988,000
	To Common stock (420,000*$1)		$420,000
	To Paid in Capital in excess of Par Value- Common Stock		$3,568,000