Reference no: EM131590217

Problem -

Journalize the entries to record the following transactions for Mountain Realty Inc. Refer to the Chart of Accounts for exact wording of account titles.

Aug.26 Issued for cash 120,000 shares of no-par common stock (with a stated value of $5) at $8.

Oct.1 Issued at par value 40,000 shares of preferred 1% stock, $10 par for cash.

Nov.30 Issued for cash 18,000 shares of preferred 1% stock, $10 par at $13.

CHART OF ACCOUNTS - Mountain Realty Inc.General Ledger

ASSETS

• 110Cash
• 120Accounts Receivable
• 131Notes Receivable
• 132Interest Receivable
• 141Merchandise Inventory
• 145Office Supplies
• 151Prepaid Insurance
• 181Land
• 193Equipment
• 194Accumulated Depreciation-Equipment

LIABILITIES

• 210Accounts Payable
• 221Notes Payable
• 226Interest Payable
• 231Cash Dividends Payable
• 236Stock Dividends Distributable
• 241Salaries Payable
• 261Mortgage Note Payable

EQUITY

• 311Common Stock
• 313Paid-In Capital in Excess of Stated Value-Common Stock
• 315Treasury Stock
• 321Preferred Stock
• 322Paid-In Capital in Excess of Par-Preferred Stock
• 331Paid-In Capital from Sale of Treasury Stock
• 340Retained Earnings
• 351Cash Dividends
• 352Stock Dividends
• 390Income Summary

REVENUE

• 410Sales
• 610Interest Revenue

EXPENSES

• 510Cost of Merchandise Sold
• 515Credit Card Expense
• 520Salaries Expense
• 531Advertising Expense
• 532Delivery Expense
• 533Selling Expenses
• 534Rent Expense
• 535Insurance Expense
• 536Office Supplies Expense
• 537Organizational Expenses
• 562Depreciation Expense-Equipment
• 590Miscellaneous Expense
• 710Interest Expense