Question

If Norben Company issues 6,000 shares of $5 par value common stock for $210,000, Group of answer choices Paid-in Capital in Excess of Par Value will be increased for $30,000. Paid-in Capital in Excess of Par Value will be increased for $180,000. Common Stock will be increased for $210,000. Cash will be increased for $180,000.

Answer 1

Answer:

The answer is: Paid-in Capital in Excess of Par Value will be increased for $180,000.

Explanation:

Norben Company's stock par value was 5$, so 6,000 stocks should be worth $30,000 par value. Since the stocks were sold at $210,000, the difference between fair market price and par value $180,000 ($210,000 - $30,000) should be credited to the account Paid-in Capital in Excess of Par Value.