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In: Accounting

hey whats the journal entry for common stock

hey whats the journal entry for common stock

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Expert Solution

1) Issuance of par-value common stock for cash:

Journal entry will be

Debit Cash account for the amount of proceeds received from the common stock issuance.

Credit Paid-in Capital in Excess of Par Value for the amount of proceeds received above the par value (it means Cash – Common Stock; (sales price minus par value) * number of shares issued).

Credit Common Stock account for the par value of the common stock issued (it means par value * number of shares issued).

2) Issuance of no-par value common stock for cash:

Journal entry will be

1) Stated Value:

Journal entries will be same to the par-value common stock

Debit Cash account for the amount of proceeds received from the common stock issuance.

Credit Paid-in Capital in Excess of Par Value for the amount of proceeds received above the par value (it means Cash – Common Stock; (sales price minus par value) * number of shares issued).

Credit Common Stock account for the par value of the common stock issued (it means par value * number of shares issued).

2) No Stated Value:

Debit Cash account for the amount of proceeds received from the common stock issuance.

Credit Common Stock account for the amount of proceeds from from the common stock issuance.

ekkarill92 answered 2 years ago
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