On June 1,Continental Company issued 8,000 shares of its $10 par common stock to Divide for a tract of land.The stock had a fair market value of $18 per share on this date.On Divide's last property tax bill,the land was assessed at $96,000.Continental should record an increase in Additional Paid-In Capital of

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The stock was issued at a fair market value of $18 per share, so the total value of the stock issued would be 8,000 shares x $18 per share = $144,000. However, Divide gave up land assessed at $96,000. Therefore, the increase in Additional Paid-In Capital would be the difference between the fair market value of the stock and the value of the land given up, which is $144,000 - $96,000 = $48,000. Each share had a par value of $10, so the number of shares issued in excess of par value is $48,000 / $10 = 4,800 shares. Therefore, the increase in Additional Paid-In Capital should be $48,000 - (4,800 shares x $10 par value) = $64,000.

On June 1,Continental Company Issued 8,000 Shares of Its $10