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Unformatted text preview: Issuance of stock-corporation can issue common stock (directly and indirectly)-US Securities exchange Par value=arbitrary amount, usually low amount; protection of corporate creditors Paid in capital=total amount of cash and other assets paid in to the corporation by stockholders in exchange for capital stock Journal entries Issuing stock at par value: Cash Common Stock Issuing stock at above par value: Cash Common Stock Paid in Capital in excess par-common stock Ex: issue 1000 share $1 per value @ par Cash 1000 Common Stock 1000 Ex: issue 1000 shares $1 per value common stock @ $5 Cash 5000 Common stock 1000 Paid in capital in excess par-common stock 4000 Ex: issue $1000 shares $1 par value common stock @ $8 Cash 8000 Common stock 1000 Paid in capital in excess par- common stock 7000 CLICKER: 1000 shares of $1 par of common stock are issued at $8, what is the journal entry? Credit common stock for $1000...
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- Fall '08