Nilson Company is incorporated at the beginning of this year and engages in a number of transactions. The following journal entries impacted its stockholders’ equity during its first year of operations.
a. | Cash | 60,000 |
|
| Common Stock, $1 Par Value |
| 1,500 |
Paid-In Capital in Excess of Par Value, Common Stock |
| 58,500 | |
b. | Organization Expenses | 20,000 |
|
| Common Stock, $1 Par Value |
| 500 |
Paid-In Capital in Excess of Par Value, Common Stock |
| 19,500 | |
c. | Cash | 6,650 |
|
| Accounts Receivable | 4,000 |
|
Building | 12,500 |
| |
Notes Payable |
| 3,150 | |
Common Stock, $1 Par Value |
| 400 | |
Paid-In Capital in Excess of Par Value, Common Stock |
| 19,600 | |
d. | Cash | 30,000 |
|
| Common Stock, $1 Par Value |
| 600 |
Paid-In Capital in Excess of Par Value, Common Stock |
| 29,400 |
Required
1.Explain the transaction(s) underlying each journal entry (a) through (d).
2. How many shares of common stock are outstanding at year-end?
3. What is the amount of minimum legal capital (based on par value) at year-end?
4. What is the total paid-in capital at year-end?
5. What is the book value per share of the common stock at year-end if total paid-in capital plus retained earnings equals $141,500?
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