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Journal Entries for Issuing/Purchasing Shares at Garza Co.

E12-2 Garza Co. had the following transactions during the current period.

Mar. 2 Issued 5,000 shares of $1 par value common stock to attorneys in payment of a bill
for $30,000 for services provided in helping the company to incorporate.

June 12 Issued 60,000 shares of $1 par value common stock for cash of $375,000.

July 11 Issued 1,000 shares of $100 par value preferred stock for cash at $110 per share.

Nov. 28 Purchased 2,000 shares of treasury stock for $80,000.

Instructions

Journalize the transactions.
Journalize cash dividends; indicate statement presentation.

Solution Preview

E12-2 Garza Co. had the following transactions during the current period.

Mar. 2 Issued 5,000 shares of $1 par value common stock to attorneys in payment of a bill
for $30,000 for services provided in helping the company to incorporate.

June 12 Issued 60,000 shares of $1 par value common stock for cash of $375,000. ...

Solution Summary

This solution provides the journal entries for each transaction as well as the final statement of shareholders' equity.

$2.19