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Santana Rey created Business Solutions on October 1, 2021. The company has been successful, and...

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Accounting

Santana Rey created Business Solutions on October 1, 2021. The company has been successful, and Santana plans to expand her business. She believes that an additional $100,000 is needed and is investigating three funding sources.

a. Santanas sister Cicely is willing to invest $100,000 in the business as a common shareholder. Because Santana currently has about $150,000 invested in the business, Cicelys investment will mean that Santana will maintain about 60% ownership and Cicely will have 40% ownership of Business Solutions.

b. Santanas uncle Marcello is willing to invest $100,000 in the business as a preferred shareholder. Marcello would purchase 1,000 shares of $100 par value, 9% preferred stock.

c. Santanas banker is willing to lend her $100,000 on a 9%, 11-year note payable. She would make monthly payments of $1,196 for 11 years.

Required: 1. Prepare the journal entry to reflect the initial $100,000 investment under each of the options a, b, and c.

-Record the issue of common stock of $100,000 cash.

-Record the issue of preferred stock of $100,000 cash.

-Record the issue of a note for $100,000 loan from the bank.

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