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13 June, 04:28

Maine Corporation has two classes of stock: Common, 3.00 par; Preferred, $30.00 par. Journalize Maine's issuance of the following:

1. 1,000 shares of common stock for $9.00 per share.

2. 1,000 shares of preferred stock for a total of $30,000.00

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  1. 13 June, 04:49
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    1) Cost of 1 share = $9.00

    No. of shares = 1000

    Total cost of shares = $9000

    Hence, the shares are issued at a premium of $6.

    Profit through premium on 1000 shares = 6*1000 = $6000

    2) Total cost of shares = $30,000

    Number of shares = 1000

    Cost of 1 share = $30.

    Hence, the shares are issued at par value with no profit no loss.
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