Answer:
Atlantic Co. Journal entries
a.
March 1
Dr Cash$300,500
Cr Common Stock $174,000
(43,500×4)
Cr Paid-in Capital$126,500
($300,000-$174,000)
(Record of common stock for cash)
b.
April 1
Dr Cash$72,000
Cr Common Stock$72,000
(Record of common stock for cash)
c.
April 6
Dr Inventory $41,000
Dr Machinery$145,000
Dr Note Receivable$91,000
Cr Common Stock$55,000
(2,200 shares *$25 per share)
Cr Paid-in Capital $222,000
($145,000+$91,000+$41,000=$277,000-$55,000= $222,000)
(To record Insurance for Inventory, machinery,and notes receivable)
Explanation:
Since On March 1 Atlantic Co. was said to issues 43,500 shares of $4 par value common stock for $300,500 this means that we have to
Debit Cash with $300,500 and Credit Common Stock with $174,000(43,500×4) as well as Credit Paid-in Capital with $126,500 ($300,000-$174,000)
On April 1, OP Co as well issues no-par value common stock for $72,000 cash this means we have to Debit Cash with $72,000 and Credit Common Stock with the same amount .
While On April 6, based on information given to us about MPG transaction, we have to record Insurance for Inventory, machinery,and notes receivable by Debiting each and Crediting common stock and paid in capital .
