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

question 27

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 entry to record the default on 200 shares would include a

• A) debit to Common Stock Subscribed for $3,000.
• B) credit to Subscriptions Receivable: Common Stock for $3,000.
• C) debit to Additional Paid-in Capital on Common Stock for $2,000.
• D) credit to Additional Paid-in Capital from Subscribed Stock for $600.

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Definitions:

Manager

A person responsible for controlling or administering an organization or group of staff, making decisions, and ensuring that goals are met.

Status

The relative social, professional, or other standing of someone or something, often compared to others within a given context.

Conformity

The behavior of aligning one's beliefs, attitudes, and actions with those of a group or society's standards and norms.

Groups

Groups consist of two or more people who interact and identify with one another, sharing a common purpose or goal.