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Homework answers / question archive / Willow Creek Nursery, with an authorization of 71,000 shares of preferred stock A class of stock with preferential rights over common stock
Willow Creek Nursery, with an authorization of 71,000 shares of preferred stock
A class of stock with preferential rights over common stock.
and 190,000 shares of common stock
The stock outstanding when a corporation has issued only one class of stock.
, completed several transactions involving its stock on October 1, the first day of operations. The trial balance at the close of the day follows:
Willow Creek Nursery
UNADJUSTED TRIAL BALANCE
October 1, 20--
| ACCOUNT TITLE | DEBIT | CREDIT | |
|---|---|---|---|
|
1 |
Cash |
4,924,500.00 |
|
|
2 |
Land |
800,000.00 |
|
|
3 |
Buildings |
1,870,000.00 |
|
|
4 |
Common Stock |
2,940,000.00 |
|
|
5 |
Paid-In Capital in Excess of Par-Common Stock |
1,984,500.00 |
|
|
6 |
Preferred Stock |
2,250,000.00 |
|
|
7 |
Paid-In Capital in Excess of Par-Preferred Stock |
420,000.00 |
|
|
8 |
Totals |
7,594,500.00 |
7,594,500.00 |
Common stock has a $20 par value and the preferred stock is 1%, 75 par value. All shares within each class of stock were sold at the same price. The preferred stock was issued in exchange for the land and buildings.
Journalize the two entries to record the transactions summarized in the trial balance. Refer to the Chart of Accounts for exact wording of account titles.
