If 100 shares of $50 par value stock were issued at $75 per share, how much would constitute capital surplus?
A) $750
B) $7,500
C) $2,500
D) A corporation cannot issue stock for higher than the par value.

Question

Quizplus · Accepted Answer

Capital surplus is calculated as the difference between the issue price and the par value, multiplied by the number of shares. Here, it's ($75 - $50) * 100 = $2,500.

If 100 Shares of $50 Par Value Stock Were Issued