Answer:
Financing activities as all transaction related to stock of the company where they are issued in exchange of cash.
Assets = Equity
Cash 70,000 = Common Stock 3,500 + Additional 66,500
Cash 192,000 = preferred 160,000 + additional 32,000
Explanation:
The cash received will be calcualted withe issance price
the common stock and prefferred with the par value ($1 for common and $50 for preferred) the additional paid-in will be the difference.
<em><u>Calculations:</u></em>
<em><u /></em>
<em>First issuancce</em>
cash:
3,500 x $20 = 70,000
common stock 3,500 shares x $1 = 3,500
additional 70,000 - 3,500 = 66,500
<em>Second issuancce</em>
cash:
3,200 x $60 = 192,000
preferred stock 3,200 x $50 = 160,000
additional paid-in 192,000 - 160,000 = 32,000
