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The Newland Company Corporation is authorized to issue 1,000,000 shares of common stock at a par value of $5. In its first year, the company has the following transactions:
January 10 – 400,000 common shares issued at $8 per share.
July 1 – Issued 100,000 shares of common stock and received land. The land had an asking price of $900,000. The stock is currently selling on a national exchange for $8.25 per share.
September 1 – Treasury stock was purchased at $9 per share.
December 1 – Sold 4,000 treasury shares at $10 per share.
Prepare the journal entries.
Prepare the Stockholders’ equity section assuming the company had retained earnings of $200,000 as of December 31.