Miller Corporation issued 7 comma 000 shares of its $5 par value common stock in payment for attorney services billed at $ 70 comma 000. Miller Corporation's stock has been actively trading at $ 10 per share. The journal entry for this transaction would include a credit to:

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Business

Ann Simpson

3 December, 15:19

Miller Corporation issued 7 comma 000 shares of its $5 par value common stock in payment for attorney services billed at $ 70 comma 000. Miller Corporation's stock has been actively trading at $ 10 per share. The journal entry for this transaction would include a credit to:

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Rex Boone · Answer 1

credit to share capital account.

common stock capital : $35,000 Credit

share premium account: $35,000 credit

Explanation:

The share capital (capital accounts) are usually credit entries. The share is trading at a premium of $5 per unit, Issue of 7000 common stock will realise a total cash of $70,000 which is used to pay off attorney services. The common stock share capital will increase by 7000 x $5 = $35,000 and the balance premium ($35,000) will be to share premium account