On December 1 SJ Company issued 800 shares of no-par common stock for $7200.The stock has stated value of $2 per share? Use the following tabular analysis to record the receipt of cash and issuance of shares:

Question

Quizplus · Accepted Answer

The correct entry for the issuance of no-par common stock with a stated value is to increase cash for the total amount received ($7200), increase common stock for the total stated value ($1600), and then increase the additional paid-in capital account for the difference ($5600). This option accurately reflects the transaction and the appropriate accounting treatment.

On December 1 SJ Company Issued 800 Shares of No-Par