Lump Sum Issuance of Par Value Shares

question 110

Essay

Lump sum issuance of par value shares
Chile Corp. issued 2,000 common shares and 400 preferred shares to an investor for $ 72,000 cash.
Instructions
a) Prepare the journal entry for the issuance, assuming the par value of the common shares was $ 5 and the market value was $ 30, and the par value of the preferred shares was $ 40 and the market value was $ 50.
a), except the preferred shares have no ready market and the common shares have a market value of $ 24.
b) Prepare the journal entry for the issuance, assuming the same facts as

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Definitions:

Full Participation

Involvement of all members of a group in the activities and decision-making processes, ensuring active and equal contribution.

Information Sharing

The practice of making relevant, important data and insights accessible to those who need it.

Operating Guidelines

Set rules or protocols designed to guide the operation of systems, processes, or activities.

Proposal

A formal suggestion or plan put forward for consideration or discussion by others.