[Jasoup]

I'm having trouble with the journalizing this:

Robb had $10 000 in accumulated savings with a potential of making $3000 per month
Apr 1st: Rob incorporated his business. Initial capitalization allowed for 20 000 par value shares. In addition he paid an additional $500 to register his website name. Rob contributed $10 000 in exchange for 10 000 shares which was deposited into a new bank account set up on Apri 1st, The bank account was a standard checking account that gave cheques returned with monthly statements of a fee of $50/month.
Note, startup costs can be capitalized as the intangible asset "organizational costs" with indefinite lifeline, website names would be afforded same treatment...

I have attempted to journalize this myself as:
For the first part I did:
dr Organizational Costs 500
cr Cash 500

Then I did:
dr Cash 10 000
Cr Common Stock 10 000

==> These journal entries... ontop of this confusion I was wondering If "Cash" is the correct account to use because it said deposited into a new bank account?

EDIT: On the bank statement of account it says Apri 1st Deposit: Credit => 10, 205
Is this referring to the stock? If my 2nd journal entry was wrong... what is the correct entry for this stock please help
I've been thinking hard for this for awhile.

[paraclete]

Careful reading is required

A journal entry is required establishing the authorised capital.
The initial expenses were not paid out of the corporate bank account so Rob is either a creditor or is entitled to additional shares or reimbursement. If these expenses were paid out of the corporate bank account the balance would be less than $10,000
The disbursement account is better named Bank. The balance indicates there are transactions other than the $10,000

[Jasoup]

Careful reading is required

A journal entry is required establishing the authorised capital.
The initial expenses were not paid out of the corporate bank account so Rob is either a creditor or is entitled to additional shares or reimbursement. If these expenses were paid out of the corporate bank account the balance would be less than $10,000
The disbursement account is better named Bank. The balance indicates there are transactions other than the $10,000

So... Is this more correct? These are the 2 supporting documents provided in the attachments... the $1500 mentioned on the invoice is not mentioned anywhere so I'm assuming Rob paid the $1500

This is what I wrote now:
Dr. Cash 20 000
Cr. Rob, Capital 20 000

Dr. Bank 10 205
Cr. Common Shares 10 000
Cr. Service Revenue 205

Dr. Organizational Cost 2000
Cr. Bank 500
Cr. Cash 1500

[paraclete]

o... Is this more correct? These are the 2 supporting documents provided in the attachments... the $1500 mentioned on the invoice is not mentioned anywhere so I'm assuming Rob paid the $1500

This is what I wrote now:
Dr. Cash 20 000
Cr. Rob, Capital 20 000

Dr. Bank 10 205
Cr. Common Shares 10 000
Cr. Service Revenue 205

Dr. Organizational Cost 2000
Cr. Bank 500
Cr. Cash 1500

I have seen the bank statement there is a great deal there that requires greater detail

However

The Authorised capital

Cr Aurthorised Capital $20,000
Dr Unissued Capital $20,000

There is no cash involved.

You cannot assume anything either a transaction can be vouched from the bank account or it remains outstanding in which case the entry would be

Dr Organisational cost $1500
Cr Creditors $1500

Cheque number 1 or cheque number 10 might be the payment of the organisational cost of $500, we don't have that detail, there is no payment of $1,500 nor do we have detail of Cash Transactions as opposed to Bank transactions

[Jasoup]

I have seen the bank statement there is a great deal there that requires greater detail

However

The Authorised capital

Cr Aurthorised Capital $20,000
Dr Unissued Capital $20,000

There is no cash involved.

You cannot assume anything either a transaction can be vouched from the bank account or it remains outstanding in which case the entry would be

Dr Organisational cost $1500
Cr Creditors $1500

Cheque number 1 or cheque number 10 might be the payment of the organisational cost of $500, we don't have that detail, there is no payment of $1,500 nor do we have detail of Cash Transactions as opposed to Bank transactions

Oh, forgot to mention for the bank statement I was just analyzing the first 2 lines (deposit and cheque 1) that apply to my question. Cheque 1 is the payment for the website name. Sorry I'm now confused of what will happen to the 10 000 shares acquired by Rob? Is authorized capital the same as the common stock I used before (I think common stock is an equity account correct?). So would it be:

Dr Unissued Capital/Common stock $20,000
Cr Authorised Capital/Authorized Common stock $20,000

Dr. Bank 10 205
Cr. Unissued Capital/ Common stock10 000
Cr. Service Revenue 205

Dr. Organizational Cost 2000
Cr. Bank 500
Cr. Creditors 1500 <===== Can I just add this 1500 to the 500 above to make:
____________________

Dr. Organizational Cost 2000
Cr. Bank 2000
____________________

Ps. Thanks for helping me so much :s
PPS. Unissued/authorized capital they're both equity accounts? Or is one different, because if they're both equity wouldn't we have 40 000 total in equity?

[paraclete]

Authorised Capital is the nominal capital of the organisation $20,000

Issued capital is the capital you have received consideration for in this case $10,000 It depends on where you are as to what descriptions are used.

I can see no transaction that justifies your last entry

[Jasoup]

Ah I see I think. So when adding these 2 types of accounts into a software program (gnucash) do I just put them as equity accounts?
Also my first 2 transactions are correct right? Except for my last? Which was:

Dr org cost 2000
Cr bank 500
Cr creditors 1500

If so... What so I'm horrible confused to what do I add the $500 from the website fee as and journalize it?
Can you help me to why 1500 is labelled to as for creditors and why there is nothing that justifies the above transaction ^