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18 January, 05:20

A corporation issued for cash 100,000 shares of its $0.01 par value common stock for $450,000. Which of the following is the correct journal entry to record this transaction?

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  1. 18 January, 08:32
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    cash = $450000 ... debit

    common stock = 1000 ... credit

    paid in capital amount = $449000 ... credit

    Step-by-step explanation:

    given data

    share = 100000

    par value = $0.01

    total selling price = $450,000

    solution

    here

    here total selling price is $450000

    so cash = $450000 ... debit

    and common stock will be

    common stock = 100000 * 0.01

    common stock = 1000 ... credit

    and paid in capital amount will be

    paid in capital amount = selling price - common stock

    paid in capital amount = $450000 - $1000

    paid in capital amount = $449000 ... credit
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