Ava School of Learning obtained a charter at the start of the year that authorized 50,000 shares of no-par common stock and 20,000 shares of preferred stock, par value $10. During the year, the following selected transactions occurred: Collected $41 cash per share from four individuals and issued 5,100 shares of common stock to each. Issued 6,100 shares of common stock to an outside investor at $41 cash per share. Issued 8,100 shares of preferred stock at $21 cash per share.
Ava School of Learning obtained a charter at the start of the year that authorized 50,000 shares of no-par common stock and 20,000 shares of preferred stock, par value $10. During the year, the following selected transactions occurred: Collected $41 cash per share from four individuals and issued 5,100 shares of common stock to each. Issued 6,100 shares of common stock to an outside investor at $41 cash per share. Issued 8,100 shares of preferred stock at $21 cash per share.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Ava School of Learning obtained a charter at the start of the year that authorized 50,000 shares of no-par common stock and 20,000 shares of
- Collected $41 cash per share from four individuals and issued 5,100 shares of common stock to each.
- Issued 6,100 shares of common stock to an outside investor at $41 cash per share.
- Issued 8,100 shares of preferred stock at $21 cash per share.
Required:
- Prepare the
journal entries indicated for each of these transactions. - Prepare the
stockholders’ equity section of thebalance sheet at December 31. At the end of the year, the accounts reflected net income of $37,000. No dividends were declared.
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