Journalizing issuance of stock and preparing the stockholders’ equity section of the balance sheetThe charter for ASAP-TV, Inc. authorizes the company to issue 100,000 shares of $5, no-par preferred stock and 500,000 shares of common stock with $1 par value. During its start-up phase, ASAP- TV completed the following transactions:RequirementsRecord the transactions in the general journal.Prepare the stockholders’ equity section of the ASARTV balance sheet at September 30, 2018, assuming ASAP-TV, Inc. had net income of $38,000 for the month. Sep. 6 Issued 550 shares of common stock to the promoters who organized thecorporation, receiving cash of $16,500.12 Issued 400 shares of preferred stock for cash of $23,000.Issued 1,500 shares of common stock in exchange for land with a market14value of $17,000.

1. Date Account Titles and Explanation Debit Credit Sept. 6 Cash $16,500…

Sep. 6 Issued 550 shares of common stock to the promoters who organized the corporation, receiving cash of $16,500. 12 Issued 400 shares of preferred stock for cash of $23,000. Issued 1,500 shares of common stock in exchange for land with a market 14 value of $17,000.

Sep. 6 Issued 550 shares of common stock to the promoters who organized the corporation, receiving cash of $16,500. 12 Issued 400 shares of preferred stock for cash of $23,000. Issued 1,500 shares of common stock in exchange for land with a market 14 value of $17,000.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter15: Contributed Capital

Section: Chapter Questions

Problem 1MC

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Question

Journalizing issuance of stock and preparing the stockholders’ equity section of the balance sheet

The charter for ASAP-TV, Inc. authorizes the company to issue 100,000 shares of $5, no-par preferred stock and 500,000 shares of common stock with $1 par value. During its start-up phase, ASAP- TV completed the following transactions:

Requirements

Record the transactions in the general journal.
Prepare the stockholders’ equity section of the ASARTV balance sheet at September 30, 2018, assuming ASAP-TV, Inc. had net income of $38,000 for the month.

Sep. 6 Issued 550 shares of common stock to the promoters who organized the
corporation, receiving cash of $16,500.
12 Issued 400 shares of preferred stock for cash of $23,000.
Issued 1,500 shares of common stock in exchange for land with a market
14
value of $17,000.

Definition Definition Assets available to stockholders after a company's liabilities are paid off. Stockholders’ equity is also sometimes referred to as owner's equity. A stockholders’ equity or book value generally includes common stock, preferred stock, and retained earnings and is an indicator of a company's financial strength.

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