Sully Sports Cars Co. entered into a subscription contract with various investors. The terms were as follows: 2,000 shares of $5 par common at $24. $10 down payment per share; two subsequent payments of $7 each. Required: A. Record the subscription and the receipt of the down payment. B. Record the first subsequent $7 payment that was received from all subscribers. C. When the final $7 payment was due, 90% of the final total amount due was received and stock was issued. Record this receipt and stock issuance. D. The remaining 10% of the final payment was not received. According to contract provisions, half of any previous payments should be returned to the subscriber with the remaining half forfeited by the subscriber. Record the entry related to the default.
Sully Sports Cars Co. entered into a subscription contract with various investors. The terms were as follows: 2,000 shares of $5 par common at $24. $10 down payment per share; two subsequent payments of $7 each. Required: A. Record the subscription and the receipt of the down payment. B. Record the first subsequent $7 payment that was received from all subscribers. C. When the final $7 payment was due, 90% of the final total amount due was received and stock was issued. Record this receipt and stock issuance. D. The remaining 10% of the final payment was not received. According to contract provisions, half of any previous payments should be returned to the subscriber with the remaining half forfeited by the subscriber. Record the entry related to the default.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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B, C, and D
Transcribed Image Text:Sully Sports Cars Co. entered into a subscription contract with various investors. The terms were
as follows:
2,000 shares of $5 par common at $24.
$10 down payment per share; two subsequent payments of $7 each.
Required:
A. Record the subscription and the receipt of the down payment.
B. Record the first subsequent $7 payment that was received from all subscribers.
C. When the final $7 payment was due, 90% of the final total amount due was received and
stock was issued. Record this receipt and stock issuance.
D. The remaining 10% of the final payment was not received. According to contract provisions,
half of any previous payments should be returned to the subscriber with the remaining half
forfeited by the subscriber. Record the entry related to the default.
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