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Pulsar Optics produces medical lasers for use in hospitals. The accounts and their balances appear in the ledger of Pulsar Optics on April 30 of the current year as follows: Preferred 1% Stock. $25 par (300.000 shares authorized. 150.000 shares issued) $3.750.000 Paid-In Capital in Excess of Par-Preferred Stock 750.000 Common Stock. $100 par (700.000 shares authorized, 300,000 shares issued) 30,000,000 Paid-In Capital in Excess of Par-Common Stock 2,400,000 Retained Earnings 60,000,000

Pulsar Optics produces medical lasers for use in hospitals. The accounts and their balances appear in the ledger of Pulsar Optics on April 30 of the current year as follows: Preferred 1% Stock. $25 par (300.000 shares authorized. 150.000 shares issued) $3.750.000 Paid-In Capital in Excess of Par-Preferred Stock 750.000 Common Stock. $100 par (700.000 shares authorized, 300,000 shares issued) 30,000,000 Paid-In Capital in Excess of Par-Common Stock 2,400,000 Retained Earnings 60,000,000

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Stock transaction for corporate expansion Pulsar Optics produces medical lasers for use in hospitals. The accounts and their balances appear in the ledger of Pulsar Optics on April 30 of the current year as follows: Preferred 1% Stock, $25 par (300,000 shares authorized, 150,000 shares issued) $3,750,000 Paid-In Capital in Excess of Par-Preferred Stock 750,000 30,000,000 Common Stock, $100 par (700,000 shares authorized, 300,000 shares issued) Paid-In Capital in Excess of Par-Common Stock 2,400,000 60,000,000 Retained Earnings At the annual stockholders' meeting on August 5, the board of directors presented a plan for modernizing and expanding plant operations at a cost of approximately $13,950,000. The plan provided (a) that the corporation borrow $3,600,000 (b) that $65,000 shares of the unissued preferred stock be issued through an underwriter, and (c) that a building, valued at 3,400,000 and the land on which it is located, valued at 5,000,000 be acquired i accordance with preliminary negotiations by the issuance of 80,000. shares of common stock. The plan was approved by the stockholders and accomplished by the following transactions: Oct. 9. Borrowed $3,600,000 from St. Peter City Bank, giving a 4% mortgage note. Oct. 17. Issued 65,000 shares of preferred stock, receiving $30 per share in cash. Oct. 28. Issued 80,000 shares of common stock in exchange for land and a building, according to the plan. Required: Journalize the entries to record the October transactions. If an amount box does not require an entry, leave it blank. Oct. 9 Oct. 17 Oct. 28
Transcribed Image Text:Stock transaction for corporate expansion Pulsar Optics produces medical lasers for use in hospitals. The accounts and their balances appear in the ledger of Pulsar Optics on April 30 of the current year as follows: Preferred 1% Stock, $25 par (300,000 shares authorized, 150,000 shares issued) $3,750,000 Paid-In Capital in Excess of Par-Preferred Stock 750,000 30,000,000 Common Stock, $100 par (700,000 shares authorized, 300,000 shares issued) Paid-In Capital in Excess of Par-Common Stock 2,400,000 60,000,000 Retained Earnings At the annual stockholders' meeting on August 5, the board of directors presented a plan for modernizing and expanding plant operations at a cost of approximately $13,950,000. The plan provided (a) that the corporation borrow $3,600,000 (b) that $65,000 shares of the unissued preferred stock be issued through an underwriter, and (c) that a building, valued at 3,400,000 and the land on which it is located, valued at 5,000,000 be acquired i accordance with preliminary negotiations by the issuance of 80,000. shares of common stock. The plan was approved by the stockholders and accomplished by the following transactions: Oct. 9. Borrowed $3,600,000 from St. Peter City Bank, giving a 4% mortgage note. Oct. 17. Issued 65,000 shares of preferred stock, receiving $30 per share in cash. Oct. 28. Issued 80,000 shares of common stock in exchange for land and a building, according to the plan. Required: Journalize the entries to record the October transactions. If an amount box does not require an entry, leave it blank. Oct. 9 Oct. 17 Oct. 28
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