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Next Level Morgan Corporation issues 500 “packages” of securities for $180 per package on December 31. Each package includes 10 shares of $1 par value common stock and 2 shares of $50 par value preferred stock. The separate market value of the common stock was $8 at the time of the sale and Morgan credits the Common Stock account for $5,000 and the Additional Paid-in Capital on Common Stock account for $29,615.38.
Required:
1. What was the separate market value of the preferred stock on the date of the sale?
2. What journal entry would Morgan make to record this transaction?
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Publisher: Cengage Learning
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