Reference no: EM133050791

Question - Authorizing and issuing preferred and common stock - Deming Contractors was involved in the following events involving stock during 2021:

1. Authorized to issue (a) 100,000 shares of $100 par value, 8 percent preferred stock; (b) 150,000 shares of no-par, $5 preferred stock; and (c) 250,000 shares of $5 par value common stock.

2. Issued 10,000 shares of $5 par value common stock for $30 per share.

3. Issued 25,000 shares of the $100 par value preferred stock for $150 per share.

4. Issued 50,000 shares of no-par preferred stock for $50 each.

Prepare entries, if appropriate, for each event, describe how each event affects the basic accounting equation, and explain the economic significance of par value.