Answer:
1. Dr Cash 250,000
Cr Common Stock 10,000
Cr Additional Paid-in Capital 240,000
2. Dr Cash 250,000
Cr Common Stock250,000
Step-by-step explanation:
(1) Preparation of the journal entry toRecord the issuance of the stock
Dr Cash 250,000
(10,000 shares × $25)
Cr Common Stock 10,000
(10,000 shares × $1)
Cr Additional Paid-in Capital
240,000
(250,000-10,000)
( Being to record the Issue of common stock above par)
(2) Preparation of the journal entry to Record the issuance of the stock assuming it is no-par value stock.
Dr Cash 250,000
(10,000 shares × $25)
Cr Common Stock250,000
(Being to record the Issue of no-par value common stock)