When companies offer new equity security issues, they publicize the offerings in the financial press and on Inter- net sites. Assume the following were among the equity offerings reported in December 2016: New Securities Issues Equity American Materials Transfer Corporation (AMTC)-7.5 million common shares, $.001 par, priced at $13.546 each through underwriters led by Second Tennessee Bank N.A. and Morgan, Dunavant & Co., according to a syndicate official. Proactive Solutions Inc. (PSI)-Offering of nine million common shares, $.01 par, was priced at $15.20 a share via lead manager Stanley Brothers, Inc., according to a syndicate official. Required: Prepare the appropriate journal entries to record the sale of both issues to underwriters. Ignore share issue costs.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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When companies offer new equity security issues, they publicize the offerings in the financial press and on Inter-
net sites. Assume the following were among the equity offerings reported in December 2016:
New Securities Issues
Equity
American Materials Transfer Corporation (AMTC)-7.5 million common shares, $.001 par, priced at
$13.546 each through underwriters led by Second Tennessee Bank N.A. and Morgan, Dunavant & Co.,
according to a syndicate official.
Proactive Solutions Inc. (PSI)-Offering of nine million common shares, $.01 par, was priced at
$15.20 a share via lead manager Stanley Brothers, Inc., according to a syndicate official.
Required:
Prepare the appropriate journal entries to record the sale of both issues to underwriters. Ignore share issue costs.
Transcribed Image Text:When companies offer new equity security issues, they publicize the offerings in the financial press and on Inter- net sites. Assume the following were among the equity offerings reported in December 2016: New Securities Issues Equity American Materials Transfer Corporation (AMTC)-7.5 million common shares, $.001 par, priced at $13.546 each through underwriters led by Second Tennessee Bank N.A. and Morgan, Dunavant & Co., according to a syndicate official. Proactive Solutions Inc. (PSI)-Offering of nine million common shares, $.01 par, was priced at $15.20 a share via lead manager Stanley Brothers, Inc., according to a syndicate official. Required: Prepare the appropriate journal entries to record the sale of both issues to underwriters. Ignore share issue costs.
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