Maxville Company issues 350 shares of $40 par preferred stock and 1,000 shares of $5 par common stock in a "package" sale on December 31. Total proceeds received amount to $38,600.Required: Record the transaction for each independent assumption shown:1.The common stock has a current market value of $18 per share; the current market value of preferred stock is not known.2.The common stock and the preferred stock have a current market value per share of $21 and $61, respectively.

The journal entries are prepared to record the transactions on regular basis. The lump sum amount…

Answered: Maxville Company issues 350 shares of…

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter10: Stockholder's Equity

Section: Chapter Questions

Problem 57E: Outstanding Stock Lars Corporation shows the following information in the stockholders equity...

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Maxville Company issues 350 shares of $40 par preferred stock and 1,000 shares of $5 par common stock in a "package" sale on December 31. Total proceeds received amount to $38,600.Required:

Record the transaction for each independent assumption shown:

1.	The common stock has a current market value of $18 per share; the current market value of preferred stock is not known.
2.	The common stock and the preferred stock have a current market value per share of $21 and $61, respectively.

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