A bank sells shares of its common stock with a par value of $100 for $200 in the market.Which two accounts on the bank's balance sheet are going to be affected?

Question

Quizplus · Accepted Answer

When a bank sells shares of its common stock above par value, the common stock outstanding account is credited for the par value of the shares, and the surplus account (or additional paid-in capital) is credited for the amount received over the par value.

A Bank Sells Shares of Its Common Stock with a Par