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astraxan [27]
3 years ago
9

Miller Corporation issued 7 comma 000 shares of its​ $5 par value common stock in payment for attorney services billed at $ 70 c

omma 000. Miller​ Corporation's stock has been actively trading at $ 10 per share. The journal entry for this transaction would include a credit​ to:
Business
1 answer:
Elina [12.6K]3 years ago
3 0

Answer:

credit to share capital account .

common stock capital : $35,000 Credit

share premium account: $35,000 credit

Explanation:

The share capital (capital accounts) are usually credit entries. The share is trading at a premium of $5 per unit , Issue of 7000 common stock will realise a total cash of $70,000 which is used to pay off attorney services. The common stock share capital will increase by 7000 x $5 = $35,000 and the balance premium ($35,000) will be to share premium account

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Brief exercise 1-9 at the beginning of the year, morales company had total assets of $816,000 and total liabilities of $526,000.
kramer

<u>Calculation of amount of stockholders' equity at the end of the year:</u>


At the beginning of the year, Morales Company had total assets of $816,000 and total assets increased $178,000 during the year, hence Total Assets at the end of the year shall be 816000+178000 = $994,000


At the beginning of the year, Morales Company had total liabilities of $526,000 and total liabilities decreased $82,000 during the year. Hence Total Liabilities at the end of the year shall be 526000-82000 = $444,000


Now we can calculate amount of stockholders' equity at the end of the year as follows:

Equity = Assets – Liabilities

= 994,000-444,000

= $550,000


Hence, the amount of stockholders' equity at the end of the year shall be <u>$550,000</u>


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