On May 10, a company issued for cash 1,500 shares of no-par common stock (with a stated value of $2) at $14, and on May 15, it issued for cash 2,000 shares of $15 par preferred stock at $58. What is the amount of paid-in capital in stated value at May 10 and paid-in capital in excess of par at May 15, assuming that the common stock is to be credited with the stated value?

Question

Quizplus · Accepted Answer

For the common stock issued on May 10: 
- Number of shares: 1,500 
- Stated value: $2 
- Total stated value = 1,500 x $2 = $3,000 
- Total amount received = 1,500 x $14 = $21,000 
- Paid-in capital in stated value = $3,000

For the preferred stock issued on May 15: 
- Number of shares: 2,000 
- Par value: $15 
- Total par value = 2,000 x $15 = $30,000 
- Total amount received = 2,000 x $58 = $116,000 
- Paid-in capital in excess of par = $116,000 - $30,000 = $86,000

Therefore, the total paid-in capital in stated value and paid-in capital in excess of par are as follows: 
- Paid-in capital in stated value as of May 10: $3,000 
- Paid-in capital in excess of par as of May 15: $86,000 
The correct answer is C.

On May 10, a Company Issued for Cash 1,500 Shares