Answer:
DEBIT $ 84.000 Cash
CREDIT $ 70.000 Common Stock
CREDIT $ 14.000 Paid-In Capital in Excess of Par Value
DEBIT $ 43.000 Promotion Expenses
CREDIT $ 3.500 Common Stock
CREDIT $ 39.500 Paid-In Capital in Excess of Par Value
DEBIT $ 43.000 Promotion Expenses
CREDIT $ 43.000 Common Stock
DEBIT $ 218.000 Cash
CREDIT $ 175.000 Preferred Stock
CREDIT $ 43.000 Paid-In Capital in Excess of Par Value
Explanation:
DEBIT $ 84.000 Cash
CREDIT $ 70.000 Common Stock
CREDIT $ 14.000 Paid-In Capital in Excess of Par Value
As the company declared a par value, it's necessary to split the equity in two accounts, Common Stock
for the stated value ($70,000) and the Paid in Capital for the excess of cash over the Common Stock ($14,000)
DEBIT $ 43.000 Promotion Expenses
CREDIT $ 3.500 Common Stock
CREDIT $ 39.500 Paid-In Capital in Excess of Par Value
As the company declared a par value, it's necessary to split the equity in two accounts, Common Stock
for the stated value ($3,500) and the Paid in Capital for the excess of the price over the Common Stock ($39,500)
In this case there is no cash because the shares are in exchange for the promotions effort (Expenses)
DEBIT $ 43.000 Promotion Expenses
CREDIT $ 43.000 Common Stock
As the company declared no-par value, it's not necessary to split the equity in two accounts, full value to common stocks account
In this case there is no cash because the shares are in exchange for the promotions effort (Expenses)
DEBIT $ 218.000 Cash
CREDIT $ 175.000 Preferred Stock
CREDIT $ 43.000 Paid-In Capital in Excess of Par Value
Last escenario the company declared preffered stock and not Common ones, so the equity account in this case it's Preferred stock
as the par value it's $100 ($175,000) to Preferred Stock and Paid in Capital for the excess of the price ($43,000)
