Question

On May 10, Paige Corporation issues 2,500 shares of $5 par value common stock for cash at $13 per share.

Journalize the issuance of the stock. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Date Account Titles and Explanation Debit Credit
May 10

Answer 1

Please refer to the below for the journal entries.

Step-by-step explanation:

Journal entry is as seen below;

Cash account Dr $32,500

Common stock Cr $12,500

Capital in excess of common stock Cr $20,000

(To record issuance of the stock)

Workings per above journal entries.

Cash

=2,500 shares × $13 per share

= $32,500

Common stock

= 2,500 shares × $5 per share

= $12,500

Paid in capital in excess of common stock

= 2,500 shares × $8 per share ($13 - $5)

= $20,000