Question

On January 2, 2016, Alpha Corporation issued 5,000 shares of $2 par value common stock. The issue price was $7.50 per share. what is the general ledger journal entry for january 2nd

Answer 1

Dr Cash 37,500

Cr Common Stock 10,000

Cr Common Stock 27,500

Step-by-step explanation:

Preparation of the general ledger journal entry for january 2nd for Alpha Corporation

Since on January 2, 2016 we were told that Alpha Corporation was said to issued 5,000 shares of $2 par value of common stock in which the issue price was $7.50 per share this means we have to Debit Cash with $37,500, Credit Common stock with $10,000 and Credit Common stock with $27,500

1/2/16

Dr Cash 37,500

(5,000 shares × 7.50 per share)

Cr Common Stock 10,000

(5,000 shares ×$2)

Cr Common Stock 27,500

($37,500-$10,000)