Use the Following Information to Answer the Question Below $\begin{array}{llr} \text { Start-up and Organization Costs } &4,000 \\ \text { Common Stock } &&4,000\\\end{array}$

Use the following information to answer the question below.
When Calvert Corporation was formed on January 1,2010,the corporate charter provided for 50,000 shares of $20 par value common stock.The following transactions were among those engaged in by the corporation during its first month of operation:
1) The corporation issued 200 shares of stock to its lawyer in full payment of the $5,000 bill for assisting the company in drawing up its articles of incorporation and filing the proper papers with the state agency.
2) The company issued 8,000 shares of stock at a price of $25 per share.
3) The company issued 7,000 shares of stock in exchange for equipment that had a fair market value of $160,000.
The entry to record transaction 1 would be:

A)
$\begin{array}{llr} \text { Start-up and Organization Costs } &4,000 \\ \text { Common Stock } &&4,000\\\end{array}$

B)
$\begin{array}{l}\text { Start-up and Organization Costs } & 5,000\\\text { Common Stock } && 4,000 \\\text { Additional Paid-in Capital } && 1,000\end{array}$
C)
$\begin{array}{llr} \text {Start-up and Organization Costs } &4,000\\ \text {Additional Paid-in Capital } &&4,000\\\end{array}$

D)
$\begin{array}{llr} \text { Start-up and Organization Costs } &5,000\\ \text { Common Stock} &&5,000\\\end{array}$