Santana Rey created Business Solutions on October 1, 2019. The company has been successful, and Santana plans to expand her business. She believes that an additional $92,000 is needed and is investigating three funding sources. a. Santana's sister Cicely is willing to invest $92,000 in the business as a common shareholder. Since Santana currently has about $138,000 invested in the business, Cicely's investment will mean that Santana will maintain about 60% ownership and Cicely will have 40% ownership of Business Solutions. b. Santana's uncle Marcello is willing to invest $92,000 in the business as a preferred shareholder. Marcello would purchase 920 shares of $100 par value, 8% preferred stock. c. Santana's banker is willing to lend her $92,000 on a 8%, 10-year note payable. She would make monthly payments of $1,116 per month for 10 years. Required: 1. Prepare the journal entry to reflect the initial $92,000 investment under each of the options (a), (b), and (c).

Santana Rey created Business Solutions on October 1, 2019. The company has been successful, and Santana plans to expand her business. She believes that an additional $92,000 is needed and is investigating three funding sources. a. Santana's sister Cicely is willing to invest $92,000 in the business as a common shareholder. Since Santana currently has about $138,000 invested in the business, Cicely's investment will mean that Santana will maintain about 60% ownership and Cicely will have 40% ownership of Business Solutions. b. Santana's uncle Marcello is willing to invest $92,000 in the business as a preferred shareholder. Marcello would purchase 920 shares of $100 par value, 8% preferred stock. c. Santana's banker is willing to lend her $92,000 on a 8%, 10-year note payable. She would make monthly payments of $1,116 per month for 10 years. Required: 1. Prepare the journal entry to reflect the initial $92,000 investment under each of the options (a), (b), and (c).

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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