Exhibit 15-2 Lawrence, Inc., Entered into a Subscription Contract with Several Subscribers

question 151

Multiple Choice

Exhibit 15-2
Lawrence, Inc., entered into a subscription contract with several subscribers that calls for the purchase of 2,000 shares of $5 par common stock for $15 a share. The contract calls for a 20% down payment and specifies that any amounts not paid within the contract period will be forfeited in full.
-Refer to Exhibit 15-2. Lawrence received final payment 80%) on 1,800 shares and issued those shares. Subscribers defaulted on 200 shares. The entries to record receipt of final payment and issuance of 1,800 shares would include a

• A) debit to Cash for $24,000.
• B) credit to Subscriptions Receivable: Common Stock for $24,000.
• C) debit to Common Stock Subscribed for $10,000.
• D) credit to Common Stock for $9,000.

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Definitions:

Beef

A type of meat obtained from cattle.

Pork

Pork refers to the culinary name for meat derived from domestic pigs, used in various dishes worldwide.

Pounds

A unit of weight measurement in the British imperial and US customary systems, equal to 16 ounces.

Steel Washers

Thin plates with holes that are normally used to distribute the load of a threaded fastener, such as a screw or nut.