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Problem -
1. On March 31, 2019- Spiderman Developments Inc. issued 20,000 packages of 1 preferred share and 1 common share for $120 each. The market value of the preferred shares was $17, and the market value of the common shares was $110. Prepare journal entries using the relative value method record the issuance of the shares.
2. On May 31, 2019- Flash Investments Inc. issued 30,000 packages of 1 preferred share and 1 common share for $70 each. The market value of the preferred shares was unknown, and the market value of the common shares was $65. Prepare journal entries using the residual value method record the issuance of the shares.
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