Question

Open in Desktop App Times New Ro.. 12 Tell me what you want to do А" А В I U ON Av pkhaha Singh Khu Question 2 (20 marks) Heuristic Solutions is authorized to issue an unlimited number of common shares and 50,000 preferred shares. During its first year (2019), the business completed the following share Issuance transactions: July 19: Issued 50,000 common shares for cash of $5 per share. Oct 3: Issued 500, $1.50 preferred shares for $50,000 cash. Oct 11: Received inventory valued at $20,000 and equipment with fair value of $10,000 for 5000 common shares Requirements a. Journalize the transactions. b. Prepare the shareholders' equity section of Heuristic Solution's balance sheet. The ending balance of Retained Earnings is a deficit of $95,000

Answer 1

@ Journal entries. Dale Debit Credid General Connel Cash Jul 19 § 2 50,000 common stock $ 250000 Ocdb. € 50,000 ( 50000 X $5 pershare) Cash Preferred stack Inventory Equipmerd Common stock $ 50,000 Odd 11 If 30,000 $ 10,000 $ 30000 Heuristic Solutions Parlial Balance sheed ( Shureholders' Equity) for the Year ended Dee. 3 1 Common stock (fas0000 +$30000) 9 280.000 Preferred stock 50,000 Tolos paid to capila $ 330,000 chessi Relained eorening (Deficit) $ (95000) Shareholderul "egosity $_325 000 I