On january 22, jefferson county rocks inc., a marble contractor, issued for cash 77,000 shares of $50 par common stock at $53, and on february 27, it issued for cash 17,040 shares of preferred stock, $10 par at $11. required: a. journalize the entries for january 22 and february 27. refer to the chart of accounts for exact wording of account titles. b. what is the total amount invested (total paid-in capital) by all stockholders as of february 27?

A) Journal Entries are in the explanation section

B) Total amount invested by stockholders - $4,268,440

Explanation:

Requirement - A)

Date          Account Titles & Explanation                Debit ($)           Credit ($)

For common stock -

Jan-22      Cash (77,000 stocks*$53)                    4,081,000

                 Common stock

                 ($50 par value, 77,000 shares)                                     3,850,000

                 Paid-in Capital in excess of par value

                 ($53 - $50 = $3; 77,000 shares)                                       231,000

As the market value of a stock price is more than par value, there will be additional paid-in capital of $3 per stock. The above journal is made to record the issuance of common stock.

For preferred stock -

Feb-27      Cash (17,040 stocks*$11)                        187,440

                 Preferred stock

                 ($10 par value, 17,040 shares)                                        170,400

                 Paid-in Capital in excess of par value - Preferred stock

                 ($11 - $10 = $1; 17,040 shares)                                           17,040

As the market value of the preferred stock is more than par value, there will be additional paid-in capital of $1 per stock. The above journal is made to record the issuance of preferred stock.

Requirement - B)

        Particulars                                                                  Amount ($)

Common Stock ($50 x 77,000)                                           3,850,000

Paid-in Capital in excess of par value-Common Stock          231,000

[($53-$50)*77,000]

Preferred stock ($10*17,040)                                                     170,400

Paid-in Capital in excess of par value - Preferred stock           17,040

[($11 - $10)*17,040 shares]

Total invested amount                                                        $4,268,440

Therefore, the shareholders invested the par value as well as additional value in order to continue the company's operation.

answer; communities of interest; i believe this is correct, plz check first good luck;

was my answer wrong?