Willow Creek Nursery, with an authorization of 73,000 shares of preferred stock and 180,000 shares of common stock, completed several transactions involving its stock on October 1, the first day of operations. The trial balance at the close of the day follows: Willow Creek NurseryUNADJUSTED TRIAL BALANCEOctober 1, 20-- ACCOUNT TITLEDEBITCREDIT1Cash3,978,000.00 2Land862,000.00 3Buildings1,922,000.00 4Preferred 1% Stock, $80 par 2,560,000.005Paid-In Capital in Excess of Par-Preferred Stock 224,000.006Common Stock, $30 par 3,510,000.007Paid-In Capital in Excess of Par-Common Stock 468,000.008Totals6,762,000.006,762,000.00 All shares within each class of stock were sold at the same price. The preferred stock was issued in exchange for the land and buildings.Journalize the two entries to record the transactions summarized in the trial balance. Refer to the Chart of Accounts for exact wording of account titles.

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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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Willow Creek Nursery, with an authorization of 73,000 shares of preferred stock and 180,000 shares of common stock, completed several transactions involving its stock on October 1, the first day of operations. The trial balance at the close of the day follows:

Willow Creek Nursery

UNADJUSTED TRIAL BALANCE

October 1, 20--

	ACCOUNT TITLE	DEBIT	CREDIT
1	Cash	3,978,000.00
2	Land	862,000.00
3	Buildings	1,922,000.00
4	Preferred 1% Stock, $80 par		2,560,000.00
5	Paid-In Capital in Excess of Par-Preferred Stock		224,000.00
6	Common Stock, $30 par		3,510,000.00
7	Paid-In Capital in Excess of Par-Common Stock		468,000.00
8	Totals	6,762,000.00	6,762,000.00

All shares within each class of stock were sold at the same price. The preferred stock was issued in exchange for the land and buildings.

Journalize the two entries to record the transactions summarized in the trial balance. Refer to the Chart of Accounts for exact wording of account titles.

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