NW Stone Supply issued 50 shares of $14 par common stock in exchange for a piece of equipment with a current market value of $1,000. Which of the following is NOT part of the journal entry for this transaction?

Question

Quizplus · Accepted Answer

The correct journal entry for this transaction would include debiting equipment for $1,000 (its market value) and crediting common stock for the par value of the shares issued ($14 x 50 = $700) and the remaining $300 would be credited to paid-in capital in excess of par-common. Therefore, debiting equipment for $700 is not part of the correct journal entry.

NW Stone Supply Issued 50 Shares of $14 Par Common