Respuesta :
Answer and Explanation:
Journal Entry:
Debit Credit
Land $ 228,000
Building $ 361,000
Common Stock $ 297,000
Paid in capital in excess of Par Value - Common Stock $ 292,000
Answer:
$ $
Land 228,000
Building 361,000
Common Stock 297,000
Share Premium 292,000
Being issuance of 33,000 shares of $9 par value common stock in exchange for land valued at $228,000 and building valued at $361,000.
Explanation:
This common stock is issued at a premium, this is because the value of the asset received in exchange for the stock is more than the par value of the common stock. The excess of the issue price above the par value of a share is share premium.
To prepare a journal for this kind of transaction, debit the relevant asset received in place of cash with the value of asset received in exchange for the common stock. in this case, debit Land account with $228,000 and debit Building Account with $361,000.
Credit the common stock account with (the quantity of shares issued multiplied by the par value)
Credit the share premium account by (difference between value received and par value of stock)
