Berry Corporation has 50,000 shares of $10 par ordinary shares authorized.The following transactions took place during 2010, the first year of the corporation's existence:
Sold 5,000 ordinary shares for $18 per share.
Issued 5,000 ordinary shares in exchange for a patent valued at $100,000.
At the end of the Berry's first year, total contributed capital amounted to

Question

Quizplus · Accepted Answer

The company sold 5,000 ordinary shares for $18 per share, which means the company raised $90,000 from the sale of these shares (5,000 x $18). 
The company also issued 5,000 ordinary shares in exchange for a patent valued at $100,000. This means that the company raised an additional $50,000 in contributed capital (5,000 x $10, the par value of the shares). 
Therefore, at the end of the first year, the total contributed capital is $90,000 + $50,000 = $140,000. However, the question is asking for the total contributed capital from the issuance of ordinary shares only, which is $90,000. Therefore, the correct answer is D, $190,000.

Berry Corporation Has 50,000 Shares of $10 Par Ordinary Shares