Prepare Journal Entries to Record the Following Transactions That Occurred

question 47

Essay

Prepare journal entries to record the following transactions that occurred during the first 2 months of operations:
$\begin{array}{|l|l|}\hline \text { Jan-10 } & \text { Sold } 95,000 \text { common shares for } \$ 8 \text { per share cash. } \\\hline 15 & \begin{array}{l}\text { Exchanged 3,000 preferred shares for equipment with a fair market value of } \\\$ 45,000\end{array} \\\hline \text { Feb-01 } & \begin{array}{l}\text { Exchanged } 500 \text { preferred shares for legal fees incurred during organization } \\\text { worth } \$ 6,000 .\end{array} \\\hline\end{array}$

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Definitions:

Government Expenditures

Spending by government agencies on goods, services, and public projects.

Federal Reserve

The central bank of the United States, overseeing the nation's monetary policy, regulation of banks, and stability of the financial system.

Tax Decrease

A decrease in the tax rates applied to individuals or companies by governmental authorities.

Money Supply

The complete tally of economic assets in an economy at a designated moment, such as cash, coins, and money in checking and savings accounts.