Logan Corporation issues 50,000 shares of $50 par value preferred stock for cash at $60 per share. The entry to record the transaction will consist of a debit to Cash for $3,000,000 and a credit or credits to
A) Preferred Stock for $3,000,000.
B) Preferred Stock for $2,500,000 and Paid-in Capital in Excess of Par Value-Preferred Stock for $500,000.
C) Preferred Stock for $2,500,000 and Retained Earnings for $500,000.
D) Paid-in Capital from Preferred Stock for $3,000,000.

Question

Quizplus · Accepted Answer

The preferred stock is credited for its par value ($50 x 50,000 = $2,500,000), and the excess over par value ($10 x 50,000 = $500,000) is credited to Paid-in Capital in Excess of Par Value-Preferred Stock.

Logan Corporation Issues 50,000 Shares of $50 Par Value Preferred