Question

Nebraska Inc. issues 3,000 shares of common stock for $45,000. The stock has a stated value of $10 per share. The journal entry to record the stock issuance would include a credit to Common Stock for

a. $15,000
b. $3,000
c. $30,000
d. $45,000

Answer 1

c. $30,000

Step-by-step explanation:

The journal entry to record the issuance of common stock is shown below:

Cash A/c Dr $45000 ($3,000 × $15)

To Common Stock $30,000 ($3,000 × $10)

To Additional Paid-in Capital in excess of par - Common Stock $15,000

(Being the issuance of stock is recorded and the remaining balance is credited to the additional paid-in capital account)

While issuing the stock, we debited the cash account and credited the common stock and additional paid-in capital account