In January 2013, Despot recorded a transaction with this journal entry: The transaction was for the:
A)Issue of 2 million shares of common stock at par value.
B)Issue of common stock for $150 million in cash.
C)Receipt of $20 per share for a new stock issue.
D)All of the above are correct.

Question

In January 2013, Despot recorded a transaction with this journal entry:  The transaction was for the:
A)Issue of 2 million shares of common stock at par value. 
B)Issue of common stock for $150 million in cash. 
C)Receipt of $20 per share for a new stock issue. 
D)All of the above are correct.

Quizplus · Accepted Answer

The journal entry indicates that Despot issued common stock for $150 million in cash, which corresponds to option B. Option A mentions the issuance of 2 million shares of common stock at par value, but the journal entry does not provide information on the number of shares issued or their par value. Option C mentions the receipt of $20 per share for a new stock issue, but there is no information in the journal entry to support this transaction. Therefore, option B is the best choice.

In January 2013, Despot Recorded a Transaction with This Journal