A corporation issues 2,500 shares of common stock for $ 45,000. The stock has a stated value of $10 per share. The journal entry to record the stock issuance would include a credit to Common Stock for
A) $25,000
B) $45,000
C) $20,000
D) $ 5,000

Question

Quizplus · Accepted Answer

The credit to Common Stock is based on the stated value per share. With a stated value of $10 per share for 2,500 shares, the credit to Common Stock would be 2,500 shares x $10 = $25,000. The remaining amount ($45,000 - $25,000 = $20,000) would be credited to Additional Paid-In Capital.

A Corporation Issues 2,500 Shares of Common Stock for