market price is $50 per share. the company will, therefore, have to issue 200 shares. Let us also assume that the par value of the stock is $10. Here is the journal entry that the company will make following the sale of the shares: Cash (200 shares x $50) 10,000 Common Stock (200 shares x $10)) 2,000 Add’l Paid in Capital (10,000 - 2,000) 8,000 The journal entry involves the following aspects: 1. Cash is increased by the number of shares sold multiplied by the…
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