Answer:
1. Dr cash $130,900
Cr common stock $104,000
Cr Additional paid-in capital - common stock $26,900
2.Dr cash $130,900
Cr common stock $130,900
3. Dr cash $130,900
Cr common stock $52,000
Cr Additional paid-in capital-common stock $78,900
Explanation:
1. Issuance of share above par will result to premium. In excess of par value, the premium should be credited to additional paid-in capital account. Above-mentioned issuance was issued at $130,900 while its par value is only $104,000 (13,000 x $8). Thus, it will result to a premium of $26,900(130,900 - 104,000). To entry the said transaction, we have to;
Dr cash $130,900
Cr common stock $104,000
Cr additional paid-in capital - common stock $26,900
2. Issuance of share with no par and no stated value will result to no discount or premium. Some state will allow this way of issuance, but some also will not. So to record the said transaction we have to;
Dr cash $130,900
Cr common stock $130,900
3. In the absence of par value, the company may refer to its stated value in issuing of shares. Issuance of shares above stated value will result to a premium that is to be closed to additional paid-in capital account.
•4 x 13,000 = 52,000
•130,900 - 52,000 = 78,900 (premium)
Entry:
Dr cash $130,900
Cr common stock $52,000
Cr additional paid-in capital - common stock $78,900
