solution: Journal entries for the following transactions $-$ ABCD$1$ Date Account Dr Cr $2$ Cash $$27,000,0003$ Common Stock $$4,500,0004$ Additional paid in capital, equity $$22,500,000$ Explanation: Common shares of$3,000,000$ issued at $$9,=$$$1\mathrm{.}53,000,000=$$$4,500,000$ Paid in capital will be $=($$$9$$$1\mathrm{.}5)3,000,000=$$$22,500,000$ Cash will be debited with $$27,000,000$ Step $2$ Jorunal entries of the following transactions $-$ ABCD$1$ Date Account Dr Cr $2$ Legal services $-$ expenses $$540,0003$ Common Stock $$90,0004$ Additional paid$-$in capital Equity $$450,000$ Explanation: Legal services incurred by the company, $=$$$960,000=$$$40,000$ Common stock will be $=$$$1\mathrm{.}560,000=$$$90,000$ Additional paid$-$in capital $$40,000$$$90,000=$$$450,000$ Step $3$ Journal entries for the following transactions $-$ Date Account Dr Cr Cash $$1,884,000$ Common Stock $$180,000$ Additional paid in capital equity $$900,000$ Preferred Equity, Stock $$720,000$ Additional paid$-$in capital, preferred $$84,000$ Common$$shares$$issued$$will$$be$=120,000$$$1\mathrm{.}5=$$$180,000$Additional$$paid$$in$$capital$$will$$be$=($$$9$$$1\mathrm{.}5)120,000=$$$900,000$ Preferred shares stock will be $$3024,000=$$$720,000$ Additional paid in capital will be $$1,884,000$$$180,000900,000720,000=$$$84,000$ Explanation: Common shares price is given in the first transaction, assuming that it is the per value share price. Step $4$ Journal entries for the following transactions $-$ ABCD$1$ Date Account Dr Cr $2$ Land $$5,424,0003$ Common Stock $$720,0004$ Additional Paid$-$in capital $$4,704,000$ Explanation: For acquisition of Land, common share of $480,000$ have been issued. Step $5$ Shareholder's equity section of the balance sheet $-$ ABC$1$ Amount Amount $2$ Stockholder's Equity $3$ Common shares, $3,660,000$ issues at $$1\mathrm{.}5$ $$5,490,0004$ Preferred shares, $24,000$ at $$30$ $$720,0005$ Additional paid in capital, equity $$28,554,0006$ Additional paid in capital, preferred $$84,0007$ Total $$34,848,000$ Explanation: Presumption $-$ As there is no Net gain, held profit are not there Answer Sold$3,000,000$ common shares at $$9\mathrm{.}00$ each, increasing cash by $$27,000,000,$ Common Stock by $$4,500,000,$ and Additional Paid$-$in Capital by $$22,500,000.$ Issued $60,000$ common shares for legal services, increasing Common Stock by $$90,000$and recognizing the fair value of services received in Additional Paid$-$in Capital. Sold $120,000$common shares and$24,000$ preferred shares for $$1,884,000,$increasing Cash by $$1,884,000,$Common Stock by $$180,000,$ Preferred Stock by $$720,000,$ and Additional Paid$-$in Capital by the difference. Exchanged $480,000$ common shares for land valued at $$5,424,000,$ increasing Land by $$5,424,000,$Common Stock by $$720,000,$ and recognizing the fair value of the land in Additional Paid$-$in Capital.