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25 April, 13:11

Prepare the journal entry to record Jevonte Company's issuance of 42,000 shares of its common stock assuming the shares have a: $4 par value and sell for $20 cash per share. $4 stated value and sell for $20 cash per share.

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  1. 25 April, 15:37
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    Find the detailed answer in the explanation section

    Explanation:

    For A. $4 par value and sell for $20 cash per share

    Par Value is $4 x 42,000 shares

    =$168,000

    Cash sales is $20 x 42,000 shares

    =$840,000

    Paid-in captial in excess of par value, common stock = $840,000 - $168,000

    =$672,000

    Journal entry:

    Dr Cash. $840,000

    Cr common stock (par value) $168,000 Cr Paid-in captial in excess of par value (common stock). $672,000

    For B. $4 stated value and sell for $20 cash per share.

    Stated Value is $4 x 42,000 shares

    =$168,000

    Cash sales is $20 x 42,000 shares

    =$840,000

    Paid-in captial in excess of stated value, common stock = $840,000 - $168,000

    =$672,000

    Journal entry:

    Dr Cash. $840,000 Cr common stock (stated value) $168,000

    Cr Paid-in captial in excess of stated value (common stock). $672,000
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