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sweet [91]
2 years ago
15

Prepare journal entries to record the following four separate issuances of stock. A corporation issued 9,000 shares of $10 par v

alue common stock for $108,000 cash. A corporation issued 4,500 shares of no-par common stock to its promoters in exchange for their efforts, estimated to be worth $49,500. The stock has a $1 per share stated value. A corporation issued 4,500 shares of no-par common stock to its promoters in exchange for their efforts, estimated to be worth $49,500. The stock has no stated value. A corporation issued 2,250 shares of $25 par value preferred stock for $105,750 cash.
Business
1 answer:
Katyanochek1 [597]2 years ago
3 0

Answer: Please see answer in explanation column

Explanation:

1. Being issued in excess of par value

Account titles & Explanations              Debit             Credit  

Cash                                           $108,000    

Common stock(9,000 x 10)                                      $90,000  

paid in capital in excess of par value

Common Stock(108,000 - 90,000)                          $18,000

2.Being issued to promoters at stated value

Account titles & Explanations     Debit           Credit  

Organisational expense           $49,500  

common stock (4500 x 1 )                                          $4,500  

paid in capital in excess of stated value

Common stock   (49,500 -4,500)                                   $45,000  

3 Being issued to promoters at no stated value

Account titles & Explanations              Debit                Credit  

        organisational expense          $49,500

Common stock of no par value                                 $49,500  

         

4 Being issued  of preferred shared in excess of par value

Account titles & Explanations           Debit                 Credit  

               Cash           $105,750  

Preferred Stock(2,250 X $25)                                   $56,250  

paid in capital in excess of par value

of preferred stock (  $105,750-  $56,250)                $49,500                  

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Which of the following are advantages of corporations: Ease of transfer and double taxation Limited liability and double taxatio
qwelly [4]

Answer:

Ease of transfer and limited liability

Explanation:

The Corporation can easily transferable as the number of shares could be divided that are purchased and sold over the stock exchange

Also they have the limited liability when there is any contigency arise due to which the corporation would be closed this would be limited to the shared amount that owned by the shareholders

Therefore the last option is correct

4 0
3 years ago
On December 2, Coley Corp. acquired 1,600 shares of its $3 par value common stock for $21 each. On December 20. Coley Corp. reis
shusha [124]

Answer:

(A) Credit Additional Paid in Capital $9,600

Explanation:

As provided earlier, shares of own company were acquired, at a premium, which creates a treasury account with the amount of purchase back of shares.

This is because of the amount paid towards purchase that is for the amount received on purchase.

Further when shares are resold the paid in capital account is credited,

Additional capital to be credited = $11 - $3 = $8 per share

$8 \times 1,200 shares = $9,600

With this amount the balance of additional capital will increase, and thus this account will be credited.

If there is any reversal to treasury stock it will be treasury stock account debit, thus option b) and option d) are completely invalid.

Further cash received = $11 \times 1,200 = $13,200 and not $25,200

Therefore option c) is also invalid.

Therefore, Correct option is

(A) Credit Additional Paid in Capital $9,600

4 0
3 years ago
Pick a company’s product/brand that you either like or are familiar with enough to know about their segmentation and targeting s
bixtya [17]

Answer:

1.The brand “Dettol” started its journey in 1933 as antiseptic liquid, but over the years, it has been extended to a number of product categories like toilet soaps, liquid hand wash, liquid body wash, shaving cream and plaster strips.  Dettol has been widely accepted and positioned as a 100% germ fighter with complete protection and control for entire family as its core value.

Their Marketing Strategy

Consumers see Dettol as an ‘expert’. It is perceived as a product which is effective and versatile and guarantees protection from germs.

2.

It uses demographic segmentation and can be used by most people of any age group.

People from all generation are the targeted customers of Dettol. Dettol follows Product specialization strategy in order to penetrate the market and increase the usage rate.  

Dettol has been successful in positioning itself as an antiseptic which safeguard/protect the people from germs. Dettol’s effective communication has always focused on the core brand positioning of protection from germs.

3.

They should continue with their current segmentation criteria. Why? It is because it has been super effective, when you think antiseptics, dettol naturally comes to mind first as they have successfully embedded the benefits of their products in our heads through mind-blowing marketing strategies.

4.

Technology has helped smaller segments become profitable by;

  • Helping to future-proof businesses while ensuring one is not running behind his/her competitors.
  • Facilitating Workforce Productivity.
  • Reducing Operational Costs.
  • Engineered a number of processes that has helped improve the Quality of Products and Processes.
  • Increasing Business Growth.
  • It has greatly helped in Managing Uncertainty.

3 0
3 years ago
SME Company has a debt-equity ratio of .60. Return on assets is 7.5 percent, and total equity is $486,000. a. What is the equity
polet [3.4K]

Answer:Equity multiplier=1.6

Explanation:

Debt equity ratio is given as  debt/equity , Therefore

Debt  = Debt equity ratio  X Equity

=0.60 x $486,000

= $291,600

The  Total assets given as Liability(debt+equity)  will now be

=$291,600+$486,000

=$777,600.

Therefore Equity multiplier, Total assets/Total equity

=(777,600/486,000)=1.6

7 0
3 years ago
Suppose that the natural rate of unemployment in a particular year is 5 percent and the actual rate of unemployment is 9 percent
Helen [10]

According to Okun’s law, for every 1 percentage point by which the actual unemployment rate exceeds the natural rate, a negative GDP gap of about 2 percent occurs. The actual unemployment rate exceeds the natural rate by 4 percent. This is calculated as follows :

Actual unemployment – natural unemployment = 9 – 5 = 4%.

Thus, according to Okun’s law the GDP gap is -8%.

If the potential GDP is $ 500 billion, the actual GDP is 8% lower than the potential GDP. In other words, 8% of the $ 500 billion is being forgone because of cyclical unemployment.

GDP forgone = 8% x potential GDP = 8% x 500 = $40 billion 

4 0
3 years ago
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