Diego Corp Received Its Charter and Began Business in 2020

question 82

Essay

Diego Corp received its charter and began business in 2020.The company was authorized to issue 20,000,$5,noncumulative preferred shares and an unlimited number of common shares.Prepare journal entries to record the following transactions that occurred during 2020:
$\begin{array}{|l|l|}\hline \text { Sep-01 } & \begin{array}{l}\text { Honoured a } \$ 55,000,12 \%, 120 \text { note payable, in exchange for } 800 \text { preferred } \\\text { shares. }\end{array} \\\hline \text { Oct-12 } & \text { Sold 1,500 preferred shares for } \$ 70 \text { per share, cash } \\\hline \text { Nov-03 } & \text { Sold 2,000 common shares at } \$ 22 \text { per share. } \\\hline\end{array}$

---

Definitions:

Progressive Taxation

A tax system where the rate of taxation increases as the taxable base (income or wealth) increases, aiming to distribute the tax burden more fairly.

Political Logrolling

A practice where politicians exchange favors by voting for each other's proposed bills or policies.

Progressive Taxation

A tax system where the tax rate increases as the taxable base amount increases, ensuring that those who have higher incomes contribute a larger share of their income in taxes, with the aim of achieving a more equitable distribution of wealth.

Political Logrolling

The act of trading favors, particularly in the political arena through mutual voting on each other's proposed bills.