Question

Novak Corporation was organized on January 1, 2020. It is authorized to issue 10,800 shares of 8%, $100 par value preferred stock, and 506,500 shares of no-par common stock with a stated value of $1 per share. The following stock transactions were completed during the first year.

Jan. 10 Issued 80,520 shares of common stock for cash at $6 per share.

Mar. 1 Issued 5,500 shares of preferred stock for cash at $109 per share.

Apr. 1 Issued 24,310 shares of common stock for land. The asking price of the land was $91,620; the fair value of the land was $80,520.

May 1 Issued 80,520 shares of common stock for cash at $8 per share.

Aug. 1 Issued 10,800 shares of common stock to attorneys in payment of their bill of $52,900 for services rendered in helping the company organize.

Sept. 1 Issued 10,800 shares of common stock for cash at $10 per share.

Nov. 1 Issued 900 shares of preferred stock for cash at $123 per share.

Prepare the journal entries to record the above 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 0 for the amounts.)

Answer 1

Journal entries

Date	General Journal	Debit	Credit
Jan 10	Cash (80520*6)	483120
	Common Stock		80520
	Paid in capital in excess of stated-Common Stock		402600
Mar 1	Cash (5500*109)	599500
	Preferred stock		550000
	Paid in capital in excess of par-Preferred stock		49500
Apr 1	Land	91620
	Common Stock		24310
	Paid in capital in excess of stated-Common Stock		67310
May 1	Cash (80520*8)	644160
	Common Stock		80520
	Paid in capital in excess of stated-Common Stock		563640
Aug 1	Organization expense	52900
	Common Stock		10800
	Paid in capital in excess of stated-Common Stock		42100
Sept 1	Cash	108000
	Common Stock		10800
	Paid in capital in excess of stated-Common Stock		97200
Nov 1	Cash (900*123)	110700
	Preferred stock		90000
	Paid in capital in excess of par-Preferred Stock		20700