Question

Cristian, Inc. issued 10,000 shares of stock at a stated value of $10/share. The total issue of stock sold for $15/share. The journal entry to record this transaction would include a

	A.	credit to Common Stock for $150,000.
	B.	debit to Cash for $100,000.
	C.	credit to Common Stock for $100,000.
	D.	credit to Paid-in Capital in Excess of Par Value for $150,000.

Answer 1

Answer: C. Credit to common stock for $100,000

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Accounts and Explanation	Debit	Credit
Cash                                                              [Total cash received = 10,000 shares x $15]	$150,000
Common stock                                             [Total stated value = 10,000 shares x $10]		$100,000
Paid-in Capital in Excess of Stated Value    [In excess of state value = 10,000 shares x ($15 - $10)]		$50,000
(To record issue of common stock)