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    Journal Entries Concerning Stockholders' Equity

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    Markus Industries is authorized by its corporate charter to issue 10,000 shares of preferred stock with a 7% dividend rate and a par value of $10 per share, and 25,000 shares of common stock with a par value of $2 per share. On January 15, 2011, Markus Industries issued 400 shares of its preferred stock for $14 per share and 5,000 shares of common stock for $2.50 per share.

    How much total cash did Markus Industries raise through the January 15th 2011 stock issuance?
    How are these journal entries recorded?

    © BrainMass Inc. brainmass.com December 24, 2021, 10:54 pm ad1c9bdddf
    https://brainmass.com/business/the-accounting-cycle/journal-entries-concerning-stockholders-equity-517509

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    Journal entries in the books of Markus Industries

    Jan-15 Cash $12,500
    Common stock $10,000
    Paid in capital in excess of par - common stock $2,500
    (To record issue of 5000 common stock of $2 par value at R$2.50 each)

    Jan-15 Cash $5,600
    Preferred stock $4,000
    Paid in capital in excess of par- preferred stock $1,600
    (To record issue of 400 Prefered stock of $10 par value at $14 each)

    Total Cash received from issuance of stock
    Common stock
    (5000 X $2) $10,000

    Preferred stock
    400 X $10 $4,000
    Paid in capital in excess of par- common stock $2,500
    Paid in capital in excess of par-Preferred stock $1,600
    Total Cash received from issuance of stock- preferred stock $18,100

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    © BrainMass Inc. brainmass.com December 24, 2021, 10:54 pm ad1c9bdddf>
    https://brainmass.com/business/the-accounting-cycle/journal-entries-concerning-stockholders-equity-517509

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