Spirit World , Inc., issued 250 comma 000 shares of no-par common stock for $ 5 per share. The journal entry to record the issuance would be: A. Journal Entry Date Accounts Debit Credit Cash 1,250,000 Common Stock 250,000 Gain on the Sale of Stock 1,000,000 B. Journal Entry Date Accounts Debit Credit Cash 250,000 Common Stock 250,000 C. Journal Entry Date Accounts Debit Credit Cash 1,250,000 Common Stock 1,250,000 D. Journal Entry Date Accounts Debit Credit Cash

Question

Ray Fitzgerald

Business

9 June, 07:05

Spirit World , Inc., issued 250 comma 000 shares of no-par common stock for $ 5 per share. The journal entry to record the issuance would be: A. Journal Entry Date Accounts Debit Credit Cash 1,250,000 Common Stock 250,000 Gain on the Sale of Stock 1,000,000 B. Journal Entry Date Accounts Debit Credit Cash 250,000 Common Stock 250,000 C. Journal Entry Date Accounts Debit Credit Cash 1,250,000 Common Stock 1,250,000 D. Journal Entry Date Accounts Debit Credit Cash

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Ahmed Rosario · Answer 1

Hi there!

The journal entry will be:

C.

Cash (debit) $1,250,000

Common Stock (credit) $1,250,000

Explanation:

As no-par value stock is a share that have been issued without a par value listed on the face of the stock certificate, just multiply the number of shares issued by the issue price per share to calculate the total proceeds from issuing the no-par common stock.