Question

In: Accounting

Question #2 During its first year of operations, Roldan Corporation had the following transactions pertaining to...

Question #2

During its first year of operations, Roldan Corporation had the following transactions pertaining to its common stock.

Jan. 10            Issued 60,000 shares for cash at $5 per share.

July 1                Issued 50,000 shares for cash at $8 per share.

Instructions:

(a) Journalize the transactions, assuming that the common stock has a par value of $5 per share.

(b) Journalize the transactions, assuming that the common stock is no-par with a stated value of $2 per share.

(c) Compare the effect the two Jan. 10 transactions would have on Roldan’s assets, liabilities, stockholders’ equity, and net income.

(d) Compare the effect the two July 1 transactions would have on Roldan’s assets, liabilities, stockholders’ equity, and net income.

Solutions

Expert Solution

(a)

Date Account Titles and Explanation Debit Credit
Jan. 10 Cash (60000 x $5) 300000
Common stock (60000 x $5) 300000
(To record issue of common stock)
Jul. 1 Cash (50000 x $8) 400000
Common stock (50000 x $5) 250000
Paid-in capital in excess of par value (50000 x $3) 150000
(To record issue of common stock)

(b)

Date Account Titles and Explanation Debit Credit
Jan. 10 Cash (60000 x $5) 300000
Common stock (60000 x $2) 120000
Paid-in capital in excess of stated value (60000 x $3) 180000
(To record issue of common stock)
Jul. 1 Cash (50000 x $8) 400000
Common stock (50000 x $2) 100000
Paid-in capital in excess of stated value (50000 x $6) 300000
(To record issue of common stock)

(c)

Balance Sheet Income Statement
Date Assets = Liab. + Equity Rev. - Exp. = Net Inc.
Cash Common stock PIC in excess of par value PIC in excess of stated value
Jan. 10 300000 = NA + 300000 NA NA NA - NA = NA
Jan. 10 300000 = NA + 120000 NA 180000 NA - NA = NA

(d)

Balance Sheet Income Statement
Date Assets = Liab. + Equity Rev. - Exp. = Net Inc.
Cash Common stock PIC in excess of par value PIC in excess of stated value
Jul. 1 400000 = NA + 250000 150000 NA NA - NA = NA
Jul. 1 400000 = NA + 100000 NA 300000 NA - NA = NA

Note: The effect of the transactions on the assets, liabilities, stockholders' equity and net income under (c) and (d) is shown by way of an accounting equation. NA denotes no effect.

ekkarill92 answered 1 year ago
Next > < Previous

Related Solutions

During its first year of operations, Collin Raye Corporation had the following transactions pertaining to its...
During its first year of operations, Collin Raye Corporation had the following transactions pertaining to its common stock. Jan. 10   Issued 80,000 shares for cash at $6 per share. Mar. 1   Issued 5,000 shares to attorneys in payment of a bill for $35,000 for services rendered in helping the company to incorporate. July 1   Issued 30,000 shares for cash at $8 per share. Sept. 1   Issued 60,000 shares for cash at $10 per share. (a)  ...
During its first year of operations, Falls Corporation had the following transactions pertaining to its common...
During its first year of operations, Falls Corporation had the following transactions pertaining to its common stock. Jan 10 issued 84,900 shares for cash at $6 per share Mar 1 Issued 5,000 shares to attorneys in payment of a bill for $37,600 for services rendered in helping the company to incorporate. July 1 Issued 33,100 shares for cash at $8 per share. Sept 1 Issued 63,200 shares for cash at $10 per share. (a)List the journal entries for these transactions,...
During its first year of operations, Roldan Corporation had the following transactions pertaining to its common...
During its first year of operations, Roldan Corporation had the following transactions pertaining to its common stock. Jan. 10 Issued 60,000 shares for cash at $5 per share. July 1 Issued 50,000 shares for cash at $8 per share. Instructions: a) Journalize the transactions, assuming that the common stock has a par value of $5 per share. (3 points) (b) Journalize the transactions, assuming that the common stock is no-par with a stated value of $2 per share. On January...
During its first year of operations, Sheridan Corporation had the following transactions pertaining to its common...
During its first year of operations, Sheridan Corporation had the following transactions pertaining to its common stock. Jan. 10 Issued 84,900 shares for cash at $6 per share. Mar. 1 Issued 5,000 shares to attorneys in payment of a bill for $37,600 for services rendered in helping the company to incorporate. July 1 Issued 33,100 shares for cash at $8 per share. Sept. 1 Issued 63,200 shares for cash at $10 per share. (a) Prepare the journal entries for these...
During its first year of operations, Sheffield Corporation had the following transactions pertaining to its common...
During its first year of operations, Sheffield Corporation had the following transactions pertaining to its common stock. Jan. 10 Issued 82,100 shares for cash at $7 per share. Mar. 1 Issued 5,000 shares to attorneys in payment of a bill for $36,700 for services rendered in helping the company to incorporate. July 1 Issued 32,300 shares for cash at $9 per share. Sept. 1 Issued 60,500 shares for cash at $11 per share. Prepare the journal entries for these transactions,...
During its first year of operations, Larkspur Corporation had the following transactions pertaining to its common...
During its first year of operations, Larkspur Corporation had the following transactions pertaining to its common stock. Jan. 10 Issued 83,700 shares for cash at $7 per share. Mar. 1 Issued 5,000 shares to attorneys in payment of a bill for $37,000 for services rendered in helping the company to incorporate. July 1 Issued 32,100 shares for cash at $9 per share. Sept. 1 Issued 63,100 shares for cash at $11 per share. Prepare the journal entries for these transactions,...
During its first year of operations, Foyle Corporation had the following transactions pertaining to its common...
During its first year of operations, Foyle Corporation had the following transactions pertaining to its common stock. Jan. 10 Issued 71,000 shares for cash at $7 per share. July    1 Issued 38,000 shares for cash at $8 per share. Journalize the transactions, assuming that the common stock has a par value of $7 per share. Journalize the transactions, assuming that the common stock is no-par with a stated value of $1 per share.
During its first year of operations, Marigold Corporation had the following transactions pertaining to its common...
During its first year of operations, Marigold Corporation had the following transactions pertaining to its common stock. Jan. 10 Issued 84,000 shares for cash at $6 per share. Mar. 1 Issued 5,000 shares to attorneys in payment of a bill for $35,000 for services rendered in helping the company to incorporate. July 1 Issued 32,000 shares for cash at $8 per share. Sept. 1 Issued 61,700 shares for cash at $10 per share. 1. Prepare the journal entries for these...
During its first year of operations, Sheffield Corporation had the following transactions pertaining to its common...
During its first year of operations, Sheffield Corporation had the following transactions pertaining to its common stock. Jan. 10 Issued 69,500 shares for cash at $5 per share. July 1 Issued 40,500 shares for cash at $8 per share. a. Journalize the transactions, assuming that the common stock has a par value of $5 per share . b. Journalize the transactions, assuming that the common stock is no-par with a stated value of $2 per share
Exercise 15-1 During its first year of operations, Vaughn Corporation had the following transactions pertaining to...
Exercise 15-1 During its first year of operations, Vaughn Corporation had the following transactions pertaining to its common stock. Jan. 10 Issued 83,100 shares for cash at $6 per share. Mar. 1 Issued 5,000 shares to attorneys in payment of a bill for $35,500 for services rendered in helping the company to incorporate. July 1 Issued 32,000 shares for cash at $8 per share. Sept. 1 Issued 64,300 shares for cash at $10 per share. (a) Prepare the journal entries...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT