Question: Tom Smith a biochemistry professor organized Biointernational Inc earlier this

Tom Smith, a biochemistry professor, organized Biointernational, Inc., earlier this year. The firm will manufacture antibiotics using gene splicing technology. Biointernational’s charter authorizes the firm to issue 20,000 shares of 10 percent, $50 par preferred stock and 100,000 shares of $3 par common stock. During the year, the firm engaged in the following transactions:
a. Issued 12,000 common shares to Tom Smith in exchange for $170,000 cash.
b. Sold 3,000 common shares to a potential customer for $17 per share.
c. Issued 1,000 shares of preferred stock to a venture capital firm for $60 per share.
d. Gave 65 shares of common stock to Susie Thomas, a local attorney, in exchange for Susie’s work in arranging for the firm’s incorporation. Susie usually charges $1,000 for comparable work.

Prepare a journal entry for each of these transactions.

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  • CreatedSeptember 22, 2015
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