Question

Martinez Corporation has been authorized to issue 20,500 shares of $100 par value, 10%, preferred stock and 1,084,200 shares of no-par common stock. The corporation assigned a $2.60 stated value to the common stock. At December 31, 2020, the ledger contained the following balances pertaining to stockholders' equity. Preferred Stock Paid-in Capital in Excess of Par-Preferred Stock Common Stock Paid-in Capital in Excess of Stated Value-Common Stock Treasury Stock (1,160 common shares) Paid-in Capital from Treasury Stock Retained Earnings Accumulated Other Comprehensive Income $125,000 15,000 1,084,200 1,834,800 13,920 1,740 81,500 62,000 The preferred stock was issued for land having a fair value of $140,000. All common stock issued was for cash. In November, 1,740 shares of common stock were purchased for the treasury at a per share cost of $12. In December, 580 shares of treasury stock were sold for $15 per share. No dividends were declared in 2020.

Answer 1

Credit Debit $ 140,000 No. Account Titles and Explanation 1 Land Preferred stock Paid-in-Capital in excess of Par-Preferred Stock (To record the issuance of preferred stock for land) $ 125,000 $ 15,000 $ 2,919,000 2 Cash ($1,084,200 + $1,834,800) Common stock Paid-in-Capital in Excess of Par-Common stock (To record the issuance of common stock for cash) $ 1,084,200 $ 1,834,800 $ 20,880 3 Treasury stock (1,740*$12) Cash (To record the purchase of treasury stock for cash) $ 20,880 $ 8,700 4 Cash (580*$15) Treasury stock (580*$12) Paid in capital from Treasury stock ($8,700 - $6,960) (To record the sale of treasury stock for cash) $ $ 6,960 1,740