Problem
Martinez Corp. 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 what he had learned earlier about corporation accounting. During the first month, he made the following entries for the corporation's capital stock.
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May 2
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Cash
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104,000
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|
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Capital Stock
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104,000
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(Issued 8,000 shares of $11 par value common stock at $13 per share)
|
|
|
|
10
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Cash
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810,000
|
|
|
Capital Stock
|
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810,000
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(Issued 15,000 shares of $16 par value preferred stock at $54 per share)
|
|
|
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15
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Capital Stock
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8,060
|
|
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Cash
|
|
8,060
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(Purchased 620 shares of common stock for the treasury at $13 per share)
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|
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On the basis of the explanation for each entry, prepare the entries that should have been made for the capital stock transactions.