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son4ous [18]
3 years ago
13

A premium on common stock: Multiple Choice

Business
1 answer:
Stolb23 [73]3 years ago
3 0

Answer:

4) Occurs when a corporation sells its stock for more than par or stated value.

Explanation:

When a stock sells at premium it means that its selling price if higher than its par value.

When a corporation sells its stock, the amount equal to par value must be recorded under common stock account, while any additional amount of money received (premium) must be recorded under the paid-in capital in excess of par value account.

For example, the corporation sells 100 stocks at $20 (par value of 10$ per stock)

  • Dr Cash account 2,000
  • Cr Common Stock account 1,000
  • Cr Paid-in Capital in Excess of Par Value account 1,000
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100 units

Explanation:

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So, the optimal number of diamonds to be ordered is 100 units.

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3 years ago
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2 years ago
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If interest rates on the euro are consistently below U.S. dollar interest rates, then for the International Fisher Equation (IFE
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