Prepare correct entries for capital stock transactions.

Flores Corporation recently hired a new accountant with extensive experience in accounting for partnerships. Because of the pressure of the new job, the accountant was unable to review his textbooks on the topic of corporation accounting. During the first month, the accountant made the following entries for the corporation's capital stock.

May 2 Cash 120,000

Capital Stock 120,000

Issued 10,000 shares of $10 par value common stock at $12 per share)

10 Cash 600,000

Capital Stock 600,000

(Issued 10,000 shares of $50 par value preferred stock at $60 per share)

15 Capital Stock 14,000

Cash 14,000

(Purchased 1,000 shares of common stock for the treasury at $14 per share)

31 Cash 8,000

Capital Stock 5,000

Gain on Sale of Stock 3,000

(Sold 500 shares of treasury stock at $16 per share)

Instructions

On the basis of the explanation for each entry, prepare the entry that should have been made for the capital stock transactions.