Nash Corporation issued 328 shares of $10 par value common stock and 113 shares

Question

Nash Corporation issued 328 shares of $10 par value common stock and 113 shares of $50 par value preferred stock for a lump sum of $15,057. The common stock has a market price of $20 per share, and the preferred stock has a market price of $90 per share.

Prepare the journal entry to record the issuance. (Round intermediate calculations to 6 decimal places, e.g. 0.546872 and final answers to 0 decimal places, e.g., 1,520. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Account Titles and Explanation

Debit

Credit

Account Titles and Explanation

Debit

Credit

Explanation / Answer

The correct answer is:

Note :

Cash received = $ 15,057

Common Stock = 328 Shares * $ 10

= $ 3,280

Preferred Stock = 113 Shares * $ 50

= $ 5,650

Alloaction of the total receipt:

3.

Paid In Capital In Excess of Par - Common Stock = Total Allocation - Common Stock Par Value

Paid In Capital In Excess of Par - Preferred Stock = Total Allocation - Preferred Stock Par Value

Account titles and explanation Debit Credit Cash 15,057 Common Stock 3,280 Preferred Stock 5,650 Paid In Capital In Excess of Par - Common Stock 2,624 Paid In Capital In Excess of Par - Preferred  Stock 3,503

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