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Prepare the Necessary Journal Entry for Each of the Following

question 153

Essay

Prepare the necessary journal entry for each of the following transactions for Zenia Corporation.
(a) Issued 2,000 shares of its $5 par value common stock for $20 per share.
(b) Issued 5,000 shares of its stock for land advertised for sale at $90,000. Zenia's stock is actively traded at a market price of $16 per share.


Definitions:

Income Tax Expense

The total amount of income tax owed to tax authorities, reflecting current tax and deferred tax charges and credits for the period.

Deferred Tax Liability

A tax obligation that a company owes but can postpone to future periods.

Interest Revenue

Income earned by an entity for lending funds or making financial investments that pay interest.

Interest Expense

The cost incurred by an entity for borrowed funds, reflected on the income statement as a reduction of profits.

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