Financial Accounting

Incentive Corporation was organized in 2009 to operate a financial consulting business. The charter authorized the following capital stock: common stock, par value $4 per share. 12,000 shares. During the first year, the following selected transactions were completed:

a - Issued 6,000 shares of common stock for cash at $20 per share.
b - Issued 2,000 shares of common stock for cash at $23 per share.

1 - show the effects of each transaction on the accounting equation.
2 - Give the journal entry required for each of these transactions.
3 - Prepare the stickholders' equity section as it should be reported on the 2009 year-end balance sheet. At year-end, the accounts reflected a profit of $100.
4 - Incentive Corporation has $30,000 in the company's bank account. Should the company declare cash dividends at this time? Explain.

I AM LOST. Can someone please instruct me on how to go about solving this question?

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  1. 1) Both assets and SE go up as cash goes to the company and more shares are bought.
    Cash $120,000
    Stocks issued on par $24,000
    Gain on c/s $96,000

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  2. , how much manufacturing overhead was allocated to production? Archangel Manufacturing has just finished the year 2012. They created a predetermined manufacturing overhead allocation rate at the beginning of the year based on a percentage of direct labor costs. Below are various data:

    Total manufacturing overhead estimated at the beginning of the year: $140,000
    Total direct labor costs estimated at the beginning of the year: $350,000
    Total direct labor hours estimated at the beginning of the year: 12,000 direct labor hours
    Actual manufacturing overhead costs for the year: $159,000
    Actual direct labor costs for the year: $362,000
    Actual direct labor hours for the year: 12,400 direct labor hours

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