Partners Meeks and Olsen wish to avoid the unlimited personal
Partners Meeks and Olsen wish to avoid the unlimited personal liability of the partnership form of business, so they are incorporating the company as M & O Services, Inc. The charter from Alberta authorizes the corporation to issue 15,000 shares of 7%, preferred shares and 220,000 common shares. In its first month, M & O Services, Inc. completed the following transactions:
Jan 3 Issued 6,200 common shares to Meeks and 3,700 shares to Olsen, both for cash of $12 per share.
12 Issued 1,200 preferred shares to acquire a patent with a market value of $180,000.
22 Issued 1,700 common shares to other investors for $12 cash per share.
Requirements
1. Record the transactions in the journal.
2. Prepare the shareholders’ equity section of the M & O Services, Inc. balance sheet at December 31. The ending balance of Retained Earnings is $59,000.
Membership TRY NOW
  • Access to 800,000+ Textbook Solutions
  • Ask any question from 24/7 available
    Tutors
  • Live Video Consultation with Tutors
  • 50,000+ Answers by Tutors
OR
Relevant Tutors available to help