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The following events occurred for Johnson Company: a. Received investment of cash by organizers and distributed to them 1,020 shares of $1 par value common stock with a market price of $30 per share. b. Purchased $7,900 of equipment, paying $1,200 in cash and owing the rest on accounts payable to the manufacturer. c. Borrowed $7,000 cash from a bank. d. Loaned $500 to an employee who signed a note. e. Purchased $19,000 of land: paid $5,000 in cash and signed a mortgage note for the balance. Prepare journal entries for the above transactions. (If no entry is required for a transaction/event, select No journal entry required” in the first account field.) Record the receipt of cash and the distribution of 1,020 shares of $1 par value common stock with a market price of $30 per share
Expert Answer
| Transaction | General Journal | Debit | Credit |
| a | Cash | $ 30,600 | |
| Common stock | $ 1,020 | ||
| Additional paid in capital in excess of par | $ 30,600 | ||
| b | Equipment | $ 7,900 | |
| Cash | $ 1,200 | ||
| Accounts payable | $ 6,700 | ||
| c | Cash | $ 7,000 | |
| Loans payable | $ 7,000 | ||
| d | Notes receivable | $ 500 | |
| Cash | $ 500 | ||
| e | Land | $ 19,000 | |
| Cash | $ 5,000 | ||
| Mortgage payable | $ 14,000 |
