Answer:
Explanation:
The journal entries are shown below:
1. Cash A/c Dr $68,000
To Common stock $5,150
To Additional paid-in capital $62,850
(Being the cash is received)
The common stock value is computed by
= Number of investors × number of shares × par value
= 5 investors × 103 shares × $10
= $5,150
And, the remaining balance is transferred to additional paid-in capital
2. No journal entry required
3. Cash A/c Dr $17,000
To Long term note payable A/c $17,000
(being cash is borrowed for long term payable)
4. Equipment A/c Dr $18,000
To Cash A/c $1,500
To Short term note payable $16,500
(Being equipment is purchased for cash and short term note payable)
5. Short term Notes receivable A/c Dr $1,600
To Cash $1,600
(Being cash is paid)
6. Store fixtures A/c Dr $19,000
To Cash A/c $19,000
(being cash is paid for store fixtures)
