Reference no: EM133150089
Question - Flounder Corporation is authorized to issue 22,500 shares of $50 par value, 10% preferred stock and 125,000 shares of $5 par value common stock. On January 1, 2022, the ledger contained the following stockholders' equity balances.
Preferred Stock (10,000 shares) $500,000
Paid-in Capital in Excess of Par-Preferred Stock 66,500
Common Stock (61,500 shares) 307,500
Paid-in Capital in Excess of Par-Common Stock 700,000
Retained Earnings 350,000
During 2022, the following transactions occurred.
Feb. 1 Issued 1,800 shares of preferred stock for land having a fair value of $128,000.
Mar. 1 Issued 1,200 shares of preferred stock for cash at $65 per share.
July 1 Issued 16,000 shares of common stock for cash at $8 per share.
Sept. 1 Issued 500 shares of preferred stock for a patent. The asking price of the patent was $28,500. Market price for the preferred stock was $69 and the fair value for the patent was indeterminable.
Dec. 1 Issued 8,000 shares of common stock for cash at $8.50 per share.
Dec. 31 Net income for the year was $261,000. No dividends were declared.
Required - Journalize the transactions and the closing entry for net income.
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