Various Journal Entries Lodi Company is authorized to issue 100,000 shares of no par, $6 stated value common stock and 10,000 shares of 9%, $100 par preferred stock. It enters into the following transactions:
1. Accepts a subscription contract to 7,000 shares of common stock at $42 per share and receives a 30% down payment.
2. Collects the remaining balance of the subscription contract and issues the common stock.
3. Acquires a building by paying $3,000 cash and issuing 3,000 shares of common stock and 900 shares of preferred stock. Common stock is currently selling at $46 per share; preferred stock has no current market value.
The building is appraised at $225,000.
4. Sells 1,000 shares of common stock at $47 per share.
5. Sells 900 shares of preferred stock at $ 112 per share.
6. Declares a three-for-one stock split on the common stock, reducing the stated value to $2.00 per share.