Ava School of Learning obtained a charter at the start of the year that authorized 50,000 shares of no-par common stock and 20,000 shares of preferred stock, par value $10. During the year, the following selected transactions occurred: Collected $30 cash per share from four individuals and issued 4,000 shares of common stock to each. Issued 5,000 shares of common stock to an outside investor at $30 cash per share. Issued 7,000 shares of preferred stock at $15 cash per share. Required: Prepare the journal entries indicated for each of these transactions. Prepare the stockholders’ equity section of the balance sheet at December 31. At the end of the year, the accounts reflected net income of $26,000. No dividends were declared.

Asmall town wants to build some new recreational facilities. the proposed facilities include a swimming pool, recreation center, basketball court and baseball field. the town council wants to provide the facilities which will be used by the most people, but they face budget and land limitations. the town has $400,000 and 14 acres of land. the pool requires locker facilities which would be in the recreation center, so if the swimming pool is built the recreation center must also be built. also, the council has only enough flat land to build the basketball court or the baseball field. the daily usage and cost of the facilities (in $1,000) are shown below. which facilities should they build? facilityusagecost ($1,000)landswimming pool4001002recreation center5002003basketball court3001504baseball field2001005