Issuing Par Value Stock Video Lessons

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Problem: The entry to record the issuance of 500 shares of $10 par-value common stock for $14 a share consists of a debit to Cash for $7,000 and a credit to Common Stock for a. $5,000 and a credit to Treasury Stock for $2,000. b. $5,000 and a credit to Paid-in Capital in Excess of Par Value—Common Stock for $2,000. c. $5,000 and a credit to Gain on Sale of Common Stock for $2,000. d. $7,000.

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Problem Details

The entry to record the issuance of 500 shares of $10 par-value common stock for $14 a share consists of a debit to Cash for $7,000 and a credit to Common Stock for

a. $5,000 and a credit to Treasury Stock for $2,000.

b. $5,000 and a credit to Paid-in Capital in Excess of Par Value—Common Stock for $2,000.

c. $5,000 and a credit to Gain on Sale of Common Stock for $2,000.

d. $7,000.

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Based on our data, we think this problem is relevant for Professor Moshier's class at ALBANY.