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Brief Exercise 08-4 (Algo) Effect of issuing common stock and par preferred stock on the...

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Accounting

image Brief Exercise 08-4 (Algo) Effect of issuing common stock and par preferred stock on the horizontal statements model LO 08-4 Mel's Organics was organized on June 5, Year 1. It was authorized to issue 103,000 shares of $5 par common stock and 28,000 shares of 6 percent cumulative class A preferred stock. The class A stock had a stated value of $40 per share. The following stock events pertain to Mel's Organics: 1. Issued 33,000 shares of common stock for $8 per share. 2. Issued 13,000 shares of the class A preferred stock for $50 per share. Required: Use a horizontal financial statements model to show how each event affects the balance sheet, income statement, and statement of cash flows. More specifically, record the amounts of the events into the model. Also, in the Statement of Cash Flows column, classify the cash flows as operating activities (OA), investing activities (IA), or financing activities (FA). Note: Enter any decreases to account balances and cash outflows with a minus sign. Leave cells blank if no input is needed

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