Reference no: EM131033740

QUESTION 1 - Gabrial Ltd. was incorporated on February 1, 2014 and is authorized to issue an unlimited number of preferred and common shares. The company entered into the following transactions during the year:

Feb 10- Issued 30,000 common shares for $2.30 per share.

Feb 21- Issued 4,000 common shares to the company's accountants as payment for a bill of $18,000 for services performed in helping the company to incorporate.

Mar 16- Issued 1,000 preferred shares for $95 per share.

Sep 10- Reacquired 3,000 common shares for $1.75 per share.

Instructions: Prepare the journal entries to record the above transactions.

QUESTION 2 - Walters Accounting Company receives its annual property tax bill for the calendar year on May1, 2015. The bill is for $32,000 and payable on June 30, 2015. Walters paid the bill on June 30, 2015. The company prepares quarterly financial statements and had initially estimated that its 2015 property taxes would be $30,000.

Instructions: Prepare all the required journal entries for 2015 related to the property taxes.