Exercise $11-10$A Effect of no$-$par common and par preferred stock on the horizontal

statements model

Mercury Corporation issued $6,000$ shares of no$-$par common stock for $$45$ per share. Mercury also

issued $3,000$ shares of $$50$ par, $5$ percent noncumulative preferred stock at $$52$ per share.

Required

a$.$ Record these events in a horizontal statements model like the following one. In the Cash Flow

column, indicate whether the item is an operating activity $($OA$),$ investing activity $($IA$),$ or financing activity $($FA$).$ Use NA to indicate that an element was not affected by the event.

LO $11-4$

Assets $=$ Equity Rev. $$ Exp. $=$ Net Inc. Cash Flow

Cash $=$ Pfd$.$ Stk$.+$ Com. Stk$.+$ PIC in Excess

b$.$ Prepare journal entries to record these transactions.