Question

Blossom Company issues 6500 shares of $10 par value common stock at $12 per share. When the transaction is recorded, credits are made to:Common Stock $65000 and Paid-in Capital in Excess of Stated Value $13000.Common Stock $78000.Common Stock $65000 and Paid-in Capital in Excess of Par Value $13000.Common Stock $65000 and Retained Earnings $13000.

Answer 1

Common Stock $65000 and Paid-in Capital in Excess of Par Value $13000

Step-by-step explanation:

When a company issues stock they have to record the transaction at the stock's par value or book value. In this case the par value was $10 per stock, so the total Common Stock account should increase by $65,000.

Any amount of money paid in excess of par value must be recorded in another account, the Paid-in Capital in Excess of Par Value account. The extra $13,000 should be recorded in this account.