Holden Bicycles has 1,000 shares outstanding each with a par value of £0.10 each.If they are sold to shareholders at £10 each, what would the additional paid-in capital be?
A)£100
B)£900
C)£9,900
D)£10,000
E)£11,000

Question

Quizplus · Accepted Answer

The additional paid-in capital is calculated by subtracting the total par value from the total amount received from shareholders. Here, the total amount received is £10,000 (£10 * 1,000 shares) and the total par value is £100 (£0.10 * 1,000 shares). Therefore, the additional paid-in capital is £9,900 (£10,000 - £100).

Holden Bicycles Has 1,000 Shares Outstanding Each with a Par