Alpha Sounds Corp., an electric guitar retailer, was organized by Michele Kirby, Paul Glenn, and Gretchen Northway. The charter authorized 1,500,000 shares of common stock with a par of $1. The following transactions affecting stockholders’ equity were completed during the first year of operations: Jan. 2 Issued 114,000 shares of stock at par to Paul Glenn for cash. 5 Issued 2,600 shares of stock at par to Michele Kirby for promotional services provided in connection with the organization of the corporation and issued 40,700 shares of stock at par to Michele Kirby for cash. (record as two separate transactions.) 8 Purchased land and a building from Gretchen Northway in exchange for stock issued at par. The building is mortgaged for $182,000 for 20 years at 6%, and there is accrued interest of $5,300 on the mortgage note at the time of the purchase. It is agreed that the land is to be priced at $61,000 and the building at $223,100 and that Gretchen Northway’s equity will be exchanged for stock at par. The corporation agreed to assume responsibility for paying the mortgage note and the accrued interest.
Alpha Sounds Corp., an electric guitar retailer, was organized by Michele Kirby, Paul Glenn, and Gretchen Northway. The charter authorized 1,500,000 shares of common stock with a par of $1. The following transactions affecting stockholders’ equity were completed during the first year of operations: Jan. 2 Issued 114,000 shares of stock at par to Paul Glenn for cash. 5 Issued 2,600 shares of stock at par to Michele Kirby for promotional services provided in connection with the organization of the corporation and issued 40,700 shares of stock at par to Michele Kirby for cash. (record as two separate transactions.) 8 Purchased land and a building from Gretchen Northway in exchange for stock issued at par. The building is mortgaged for $182,000 for 20 years at 6%, and there is accrued interest of $5,300 on the mortgage note at the time of the purchase. It is agreed that the land is to be priced at $61,000 and the building at $223,100 and that Gretchen Northway’s equity will be exchanged for stock at par. The corporation agreed to assume responsibility for paying the mortgage note and the accrued interest.
Financial Accounting
14th Edition
ISBN:9781305088436
Author:Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:Carl Warren, Jim Reeve, Jonathan Duchac
Chapter13: Corporations: Organization, Stock Transactions, And Dividends
Section: Chapter Questions
Problem 3PA: The following selected accounts appear in the ledger of EJ Construction Inc. at the beginning of the...
Related questions
Question
Alpha Sounds Corp., an electric guitar retailer, was organized by Michele Kirby, Paul Glenn, and Gretchen Northway. The charter authorized 1,500,000 shares of common stock with a par of $1.
The following transactions affecting stockholders’ equity were completed during the first year of operations:
Jan. | 2 | Issued 114,000 shares of stock at par to Paul Glenn for cash. |
5 | Issued 2,600 shares of stock at par to Michele Kirby for promotional services provided in connection with the organization of the corporation and issued 40,700 shares of stock at par to Michele Kirby for cash. (record as two separate transactions.) | |
8 | Purchased land and a building from Gretchen Northway in exchange for stock issued at par. The building is mortgaged for $182,000 for 20 years at 6%, and there is accrued interest of $5,300 on the mortgage note at the time of the purchase. It is agreed that the land is to be priced at $61,000 and the building at $223,100 and that Gretchen Northway’s equity will be exchanged for stock at par. The corporation agreed to assume responsibility for paying the mortgage note and the accrued interest. |
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Financial Accounting
Accounting
ISBN:
9781305088436
Author:
Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
Financial Accounting
Accounting
ISBN:
9781305088436
Author:
Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College