Torrie Corporation Is Authorized to Issue an Unlimited Number of Common

question 27

Essay

Torrie Corporation is authorized to issue an unlimited number of common shares and 1,000,000 shares of preferred shares. During 2013, its first year of operation, the company had profit of $200,000. The following share transactions occurred:
Jan 1 Paid the province $2,000 for incorporation fees.
Jan 15 Issued 500,000 of $1 cumulative preferred shares at $7 per share.
Jan 30 Lawyers for the company accepted 500 common shares as payment for legal services provided in helping the company incorporate. The legal services are estimated to have a value of $5,000. The shares were actively trading at $10.50 per share.
Jul 2 Issued 100,000 common shares for land. The land had an asking price of $900,000. The shares are currently selling on a provincial exchange at $8 per share.
Instructions
a. Journalize the transactions for Torrie Corporation.
b. Prepare the shareholders' equity section of the balance sheet.

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Definitions:

EDLP

Stands for "Every Day Low Prices," a pricing strategy aimed at providing customers with consistently low prices without the need for sales or discounts.

Everyday Low Pricing

A pricing strategy where a company consistently offers low prices rather than relying on sales or discounts, aiming to attract budget-conscious consumers.

Grocer Shoppers

Individuals who purchase food and other goods at grocery stores.

Value Pricing

The practice of simultaneously increasing product and service benefits while maintaining or decreasing price.