qs 13 - 3 (algo) issuance of par and stated value common stock lo p1\nprepare the journal entry to record…

qs 13 - 3 (algo) issuance of par and stated value common stock lo p1\nprepare the journal entry to record jevonte companys issuance of 31,000 shares of its common stock assuming the shares have a:\na. $2 par value and sell for $18 cash per share.\nb. $2 stated value and sell for $18 cash per share.\njournal entry worksheet\n< 1 2\nrecord the issuance of 31,000 shares of common stock assuming the shares have a $2 par value and sell for $18 cash per share.\nnote: enter debits before credits.\ntransaction general journal debit credit\n

qs 13 - 3 (algo) issuance of par and stated value common stock lo p1\nprepare the journal entry to record jevonte companys issuance of 31,000 shares of its common stock assuming the shares have a:\na. $2 par value and sell for $18 cash per share.\nb. $2 stated value and sell for $18 cash per share.\njournal entry worksheet\n< 1 2\nrecord the issuance of 31,000 shares of common stock assuming the shares have a $2 par value and sell for $18 cash per share.\nnote: enter debits before credits.\ntransaction general journal debit credit\n

Answer

Explanation:

Step1: Calculate cash received

Cash = Number of shares × Issue - price per - share. Cash = 31000×18 = 558000.

Step2: Calculate par - value of shares issued

Par - value = Number of shares × Par value per - share. Par - value = 31000×2 = 62000.

Step3: Calculate additional paid - in capital

Additional paid - in capital = Cash received−Par - value of shares issued. Additional paid - in capital = 558000 - 62000=496000.

For part a:

Transaction General Journal Debit Credit
a Cash 558000
Common Stock (at par) 62000
Additional Paid - in Capital, Common Stock 496000

Step4: For part b (when stated value is used instead of par value, the accounting treatment is similar to par - value case)

Cash = 31000×18 = 558000. Stated - value = 31000×2 = 62000. Additional paid - in capital = 558000 - 62000 = 496000.

Transaction General Journal Debit Credit
b Cash 558000
Common Stock (at stated value) 62000
Additional Paid - in Capital, Common Stock 496000

Answer:

For part a:

Transaction General Journal Debit Credit
a Cash 558000
Common Stock (at par) 62000
Additional Paid - in Capital, Common Stock 496000

For part b:

Transaction General Journal Debit Credit
b Cash 558000
Common Stock (at stated value) 62000
Additional Paid - in Capital, Common Stock 496000