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Issuing Stock
Professional Products Inc., a wholesaler of office products, was organized on February 5 of the current year, with an authorization of 50,000 shares of preferred 2% stock, $40 par and 1,000,000 shares of $8 par common stock. The following selected transactions were completed during the first year of operations:
Journalize the transactions.
Feb. 5. Issued 600,000 shares of common stock at par for cash.
Feb. 5
Feb. 5. Issued 1,500 shares of common stock at par to an attorney in payment of legal fees for organizing the corporation.
Feb. 5
Apr. 9. Issued 45,000 shares of common stock in exchange for land, buildings, and equipment with fair market prices of $100,000, $310,000, and $85,000 respectively.
For a compound transaction, if an amount box does not require an entry, leave it blank.
Apr. 9
June 14. Issued 30,000 shares of preferred stock at $53 for cash.
For a compound transaction, if an amount box does not require an entry, leave it blank.
June 14

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Answer:

Feb. 5. Issued 600,000 shares of common stock at par for cash.

Dr Cash 4,800,000

    Cr Common stock 4,800,000

Feb. 5. Issued 1,500 shares of common stock at par to an attorney in payment of legal fees for organizing the corporation.

Dr Organization costs 12,000

    Cr Common stock 12,000

Apr. 9. Issued 45,000 shares of common stock in exchange for land, buildings, and equipment with fair market prices of $100,000, $310,000, and $85,000 respectively.

Dr Land 100,000

Dr Buildings 310,000

Dr Equipment 85,000

    Cr Common stock 360,000

    Cr Additional paid in capital: common stock 135,000

June 14. Issued 30,000 shares of preferred stock at $53 for cash.

Dr Cash 1,590,000

    Cr Common stock 240,000

    Cr Additional paid in capital: common stock 1,350,000

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