Answer:
Journal Entries
January 22
Dr. Cash $6,840,000
Cr. Common stock $6,840,000
February 14
Dr. Cash $720,000
Cr. Preferred stock $720,000
August 30
Dr. Cash $2,635,000
Cr. Preferred stock $2,480,000
Cr. Paid in capital excess of par-Preferred stock $155,000
Explanation:
January 22
Common Stock = Numbers of shares issued x Issue price per share
Common Stock = 342,000 shares x $20
Common Stock = $6,840,000
February 14
Preferred stock = Numbers of preferred shares x Price per preferred share
Preferred stock = 9,000 shares x $80 per share
Preferred stock = $720,000
August 30
Cash Received = Numbers of shares x issuance price = 31,000 x $85 = $2,635,000
Cash Received = Numbers of shares x par value = 31,000 x $80 = $2,480,000
Paid in capital excess of par = $2,635,000 - $2,480,000 = $155,000
