Recording Transactions Affecting Stockholders' Equity (AP11-2)
King Corporation began operations in January 2011. The charter authorized the following capital stock:
Preferred stock: 10 percent, $10 par, authorized 40,000 shares
Common stock: $5 par. authorized 85,000 shares
During 2011, the following transactions occurred in the order given:
a. Issued 22,000 shares of common stock to each of the three organizers and collected $9 cash per share from each of them.
b. Sold 9,000 shares of the preferred stock at $20 per share.
c. Sold 1,000 shares of the preferred stock at $20 and 1,500 shares of common stock at $10 per share.
Required:
Give the journal entries indicated for each of these transactions.
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