This exercise shows the similarity and difference between tw

This exercise shows the similarity and difference between two ways to acquire plant assets (Click the icon to view the cases.) Compare the balances in all accounts after making both sets of entries. Are the account balances similar or different? (Record debits first, then credits. Exclude explanations from any journal entries.) Case A - Journalize the issuance of the common stock Journal Entry Accounts Debit Credit Date

Solution

Journal Entries Accounts title and explanation Debit $ Credit $ CASE-A Cash Account Dr. 600000      Common Stock Capital 100000      Additional Paid in capital-Common Stock 500000 Building Account Dr. 475000 Equipment Account Dr. 125000      Cash account 600000 CASE-B Building Account Dr. 475000 Equipment Account Dr. 125000      Common Stock Capital Account 100000      Additional paid in capital-Common Stock 500000