Question

When a company issues 32,000 shares of $2 par value common stock for $20 per share, the journal entry for this issuance would include:_____.A. A debit to Additional Paid-in Capital for $76,000. B. A debit to Cash for $76,000. C. A credit to Common Stock for $760,000. D. A credit to Additional Paid-in Capital for $684,000.

Answer 1

Please the options provided are not correct for the question given.

Answer: When a company issued 32,000 shares of $1 par value common stock for $10 per share, the journal entry for this issuance would include a debit to cash for $640,000 , a credit to common stock and Additional paid in capital for $64,000 and $576,000 respectively.

Step-by-step explanation:

Company issued = 32,000 shares

For par value = $2

Common stock for = $20 per share

The Journal Entry would be,

Accounts title and explanation Debit Credit

Cash ($32,000 shares x $20) $640,000

Common Stock (32,000 shares x $2) $64,000

Additional paid-In capital in excess par—common stock $576,000 ($640,000 - $64,000)