Part A
The stockholders' equity section of Gamma Corporation's balance sheet as of December 31,
2025 is as follows:
Stockholders' Equity
Preferred stock, 5%, $100 par value; 500,000 shares
authorized, 15,000 shares issued $ 1,500,000
Paid-in capital in excess of par-Preferred 75,000
Common stock, $5 par value; 2,000,000 shares authorized;
600,000 shares issued and outstanding 3,000,000
Paid-in capital in excess of par-Common 850,000
Retained earnings 4,500,000
$ 9,925.000
Record the following events that occurred during 2026.
a) Issued 15,000 shares of common stock in exchange for equipment. The equipment has a list
price of $150,000. The market price of the stock on the date of the exchange was $9.75 per
share.
b) Issued for a lump-sum amount of $800,000: 25,000 shares of common stock with a current
market value of $11.25 and 5,000 shares of preferred stock with a current market value $112
per share.
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