Prepare journal entries to record the following four separate issuances of stock. 1. A corporation issued 8,000 shares of $20 par value common stock for $192,000 cash.
2. A corporation issued 4,000 shares of no-par common stock to its promoters in exchange for their efforts, estimated to be worth $33,000. The stock has a $1 per share stated value.
3. A corporation issued 4,000 shares of no-par common stock to its promoters in exchange for their efforts, estimated to be worth $33,000. The stock has no stated value.
4. A corporation issued 2,000 shares of $75 par value preferred stock for $183,000 cash.

1.

DR Cash$192,000  

     CR Common stock.  $160,000

     CR Paid-in capital in excess of par value - Common stock  $32,000

Working

Common Stock = $20 * 8,000

= $160,000

Paid-in capital in excess of par value - Common stock = 192,000 - 160,000

= $32,000

2

DR Organization expenses$33,000  

       CR Common stock,  $4,000

     CR Paid-in capital in excess of stated value - common stock  $29,000

Working

Common Stock = 1 * 4,000

= $4,000

Paid-in capital in excess of stated value, common stock = 33,000 - 4,000

= $29,000

3

DR Organization expenses$33,000  

       CR Common stock  $33,000

4

DR Cash$183,000  

        CR Preferred stock  $150,000

        CR Paid-in capital in excess of par value - preferred stock  $33,000

Working

Preferred Stock = 75 * 2,000

= $150,000

Paid-in capital in excess of par value - preferred stock = 183,000 - 150,000

= $33,000

rational decision making is a multi-step process for making choices between alternatives. the process of rational decision making favors logic, objectivity, and analysis over subjectivity and insight. the word “rational” in this context does not mean sane or clear-headed as it does in the colloquial sense.

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