The total value of the deposit made into the company bank account is $100,000.
How to solve this?
The number of shares received in exchange for this deposit is 20,000.
As the par value per share is $5, the calculation to determine the value of each share issued is done by dividing the total deposit by the number of shares issued: $100,000 / 20,000 shares = $5 per share.
Therefore, each share of the plumbing repair business is valued at $5.
The Complete Question
If a plumbing repair business initiates operations by depositing $100,000 into a company bank account and receives 20,000 shares of $5 par value common stock in exchange, what is the value of each share issued?