Montana City Company began business on January 1, 2016.The corporate charter authorized issuance of 500 shares of $1 par value common stock and 400 shares of $4 par value, 3% cumulative preferred stock.What is the maximum amount that can be reported on the balance sheet for Common Stock and Preferred Stock, respectively, if all of the stock is issued? $\begin{array}{cc}
\text { Common Stock } & \text { Preferred Stock } \
\hline \text { a. } \$ 500 & \$ 1,600 \
\text { b. } \$ 5,000 & \$ 120 \
\text { c. } \$ 500 & \$ 120\
\text { d. Not enough information provided.}\
\end{array}$

Question

Montana City Company began business on January 1, 2016.The corporate charter authorized issuance of 500 shares of $1 par value common stock and 400 shares of $4 par value, 3% cumulative preferred stock.What is the maximum amount that can be reported on the balance sheet for Common Stock and Preferred Stock, respectively, if all of the stock is issued? ​ $\begin{array}{cc}
 \text { Common Stock } & \text { Preferred Stock } \
\hline \text { a. } \$ 500 & \$ 1,600 \
\text { b. } \$ 5,000 & \$ 120 \
\text { c. } \$ 500 & \$ 120\
\text { d. Not enough information provided.}\
\end{array}$

Quizplus · Accepted Answer

The Answer of Montana City Company began business on January 1, 2016.The corporate charter authorized issuance of 500 shares of $1 par value common stock and 400 shares of $4 par value, 3% cumulative preferred stock.What is the maximum amount that can be reported on the balance sheet for Common Stock and Preferred Stock, respectively, if all of the stock is issued? ​ $\begin{array}{cc}
 \text { Common Stock } & \text { Preferred Stock } \
\hline \text { a. } \$ 500 & \$ 1,600 \
\text { b. } \$ 5,000 & \$ 120 \
\text { c. } \$ 500 & \$ 120\
\text { d. Not enough information provided.}\
\end{array}$

Montana City Company Began Business on January 1, 2016