H. Tillman performed legal services for J. Laney. Due to a cash shortage, an agreement was reached whereby J. Laney. would pay H. Tillman a legal fee of approximately $4,000 by issuing 1,000 shares of its common stock (par $1). The stock trades on a daily basis and the market price of the stock on the day the debt was settled is $4.50 per share. Given this information, the journal entry for J. Laney. to record this transaction is: Legal Expense 4,500 Common Stock 1,000 Paid-in Capital in Excess of Par - Common 3,500 Legal Expense 4,500 Common Stock 4,500 Legal Expense 4,000 Common Stock 4,000 Legal Expense 4,000 Common Stock 1,000 Paid-in Capital in Excess of Par - Common 3,000

H. Tillman performed legal services for J. Laney. Due to a cash shortage, an agreement was reached whereby J. Laney. would pay H. Tillman a legal fee of approximately $4,000 by issuing 1,000 shares of its common stock (par $1). The stock trades on a daily basis and the market price of the stock on the day the debt was settled is $4.50 per share. Given this information, the journal entry for J. Laney. to record this transaction is: Legal Expense 4,500 Common Stock 1,000 Paid-in Capital in Excess of Par - Common 3,500 Legal Expense 4,500 Common Stock 4,500 Legal Expense 4,000 Common Stock 4,000 Legal Expense 4,000 Common Stock 1,000 Paid-in Capital in Excess of Par - Common 3,000

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter20: Corporations: Organization And Capital Stock

Section: Chapter Questions

Problem 1CP: Prepare general journal entries for the following transactions, identifying each transaction by...

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H. Tillman performed legal services for J. Laney. Due to a cash shortage, an agreement was reached whereby J. Laney. would pay H. Tillman a legal fee of approximately $4,000 by issuing 1,000 shares of its common stock (par $1). The stock trades on a daily basis and the market price of the stock on the day the debt was settled is $4.50 per share. Given this information, the journal entry for J. Laney. to record this transaction is:
In September, the company entered the following transactions: Sept. 1 Issued common shares to Tony Ferria and other investors in exchange for $100,000 cash. Sept 1 Paid $9,000 to Wellington Realty as three months’ advance rent on the rental yard and office formerly occupied by Rent-It Sept 1 Purchased for $180,000 all the equipment formerly owned by Rent-It. Paid $70,000 cash and issued a one-year note payable for $110,000, plus interest at the annual rate of 9%. This rental equipment is estimated to have a 10-year useful life. Sept 4 Purchased office supplies on account from Modern Office Co., $1,630. Payment due in 30 days. (These supplies are expected to last for several months.) Sept 8 Received $10,000 cash from McFadden Construction Co. as advance payment for equipment rental. Sept 12 Paid salaries for the first two weeks in September, $3,600. Sept 15 Excluding the McFadden…
On November 1 of the current year, Rob Elliot invested $30,000 of his cash to form a corporation, GGE Enterprises Inc., in exchange for shares of common stock. No other common stock was issued during November or December. After a very successful first month of operations, the retained earnings as of November 30 were reported at $5,000.00. After all transactions have been entered into the accounting equation for the month of December, the ending balances for selected items on December 31 follow. On that date, the financial statements were prepared. The balance sheet reported total assets of $56,900 and total stockholders' equity of $38,445. 5. By what amount did retained earnings increase or decrease during the period 6. What is the amount of profit or loss during December ? 7. What were the total expenses for December ?
On November 1 of the current year, Rob Elliot invested $30,000.00 of his cash to form a corporation, GGE Enterprises Inc., in exchange for shares of common stock. No other common stock was issued during November or December. After a very successful first month of operations, the retained earnings as of November 30 were reported at $5,000.00. After all transactions have been entered into the accounting equation for the month of December, the ending balances for selected items on December 31 follow. On that date, the financial statements were prepared. The balance sheet reported total assets of $55,650.00 and total stockholders' equity of $38,000.00. I need help with three Questions: 1) What is the amount of profit or loss during December? 2. What were the total expenses for December? 3) How much was paid for supplies? Cash Acct.Rec Land Acct.Pay Common Stock Retained earnings Dividends Fees earned Rent exp Supplies exp Utilities exp wages exp Misc exp ? 8600 16500 ? ? 5000 5750…
On November 1 of the current year, Rob Elliot invested $29,250 of his cash to form a corporation, GGE Enterprises Inc., in exchange for shares of common stock. No other common stock was issued during November or December. After a very successful first month of operations, the retained earnings as of November 30 were reported at $5,000. After all transactions have been entered into the accounting equation for the month of December, the ending balances for selected items on December 31 follow. On that date, the financial statements were prepared. The balance sheet reported total assets of $55,400 and total stockholders' equity of $37,250. By what amount did retained earnings increase or decrease during the period?
On November 1 of the current year, Rob Elliot invested $30,500.00 of his cash to form a corporation, GGE Enterprises Inc., in exchange for shares of common stock. No other common stock was issued during November or December. After a very successful first month of operations, the retained earnings as of November 30 were reported at $5,000.00. After all transactions have been entered into the accounting equation for the month of December, the ending balances for selected items on December 31 follow. On that date, the financial statements were prepared. The balance sheet reported total assets of $54,400.00 and total stockholders' equity of $38,955.00. 2. What is the retained earnings amount reported on December 31? 3. How much does GGE Enterprises Inc. owe to its creditors? 4. How much cash is being held by GGE Enterprises Inc.? 5. By what amount did retained earnings increase or decrease during the period? 6. What is the amount of profit or loss during December?
On November 1 of the current year, Rob Elliot invested $30,500.00 of his cash to form a corporation, GGE Enterprises Inc., in exchange for shares of common stock. No other common stock was issued during November or December. After a very successful first month of operations, the retained earnings as of November 30 were reported at $5,000.00. After all transactions have been entered into the accounting equation for the month of December, the ending balances for selected items on December 31 follow. On that date, the financial statements were prepared. The balance sheet reported total assets of $54,400.00 and total stockholders' equity of $38,955.00. 6. What is the amount of profit or loss during December? 7. What were the total expenses for December? 8. How much was paid for rent?
Prepare general journal entries for the following transactions, identifying each transaction by letter:(a) Gnu Company issued 5,000 shares of $1 par common stock to the Prendergas law firm as partial payment of fees incurred to incorporate the business. Gnu was short of cash, so Prendergas agreed to accept $10,000 cash and the shares of common stock in full settlement of its bill for $55,000.(b) Gnu issued 50,000 shares of $1 par common stock in exchange for a parcel of land for building a shopping plaza. (The list price for the land was $400,000; a similar parcel in the same area sold last week for $380,000. During the past month, the price at which Gnu’s common stock has traded on the open market has ranged from $5 to $12 per share. Two trades occurred yesterday at $7 and $10 per share.)(c) Gnu purchased 10,000 shares of $1 par value common treasury stock for $70,000. (This is the only treasury stock that Gnu holds.)(d) Gnu sold 4,000 shares of common treasury stock for $32,000.(e)…
East Co. issued 1,000 shares of its $5 par common stock toHowe as compensation for 1,000 hours of legal services performed.Howe usually bills $160 per hour for legal services. Onthe date of issuance, the stock was trading on a public exchange at$140 per share. By what amount should the additional paid-incapital account increase as a result of this transaction?
Smart Corporation owes a trade creditor $ 30,000 on open account which the corporation does not have sufficient cash to pay. The trade creditor suggests that Smart Corporation issue to him 750 shares of the $ 24 par value common stock, which is currently selling on the market at $ 40. Present the entry or entries that should be made on Smart Corporation’s books.
ABC was formed by an investor who exchanged 1,000,000 for 100,000 shares of stock on August 1. ABC prepaid 18 months of rent by paying $96,000. ABC hired 3 employees and agreed to pay each $100,000/year. ABC agreed to pay at the end of each month; after the services are performed. ABC withholds 20% for federal tax; 5% for state tax; and 7.65% for FICA. ABC sold services over the year for $1,200,000 on account. They warranty their work for 1 year. ABC estimated 1% for bad debts using the percent of sales method. ABC estimated $100,000 in warranty work, but only paid out $20,000 (as cash back) in warranties through the end of the year. ABC received $400,000 in cash against the receivable by year-end. On 8/15 ABC purchased equipment signing a note for $400,000. ABC depreciated the equipment by $60,000 for book purposes and $50,000 for tax purposes. ABC accrued $6,000 in interest expense. On 8/1 ABC invested $200,000 into muni-bonds. The bonds paid $9,000 in interest. ABC driver got a…
During its first month of operation, the Quick Tax Corporation, which specializes in tax preparation, completed the following transactions. July 1 Began business by making a deposit in a company bank account of $60,000, in exchange for 6,000 shares of $10 par value common stock. July 3 Paid the current month's rent, $3,500 July 5 Paid the premium on a 1-year insurance policy, $4,200 July 7 Purchased supplies on account from Little Company, $1,000. July 10 Paid employee salaries, $3,500 July 14 Purchased equipment from Lake Company, $10,000. Paid $2,500 down and the balance was placed on account. Payments will be $500.00 per month until the equipment is paid. The first payment is due 8/1. Note: Use accounts payable for the balance due. July 15 Received cash for preparing tax returns for the first half of July, $8,000 July 19 Made payment on account to Lake Company, $500. July 31 Received cash for preparing tax returns for the last half of July, $9,000 July 31 Declared and paid cash…