A corporation issued 5,600 shares of $10 par value common stock in exchange for

Question

A corporation issued 5,600 shares of $10 par value common stock in exchange for some land with a market value of $82 000. The entry to record this exchange is: Multiple Cholce Debit Land $82.000, credit Common Stock $56,000, credit Paid-In Capital in Excess of Par Velue, Common Stock $26.000 Debit Land $82,000, credit Common Stock $82000 Debit Land $56.000, crean Common Stock $56.000 Debit Common Stock $$6.00o. debit Paid-in Capital in Excess of Par Vislue. Common Stock $26,000, credit Land $82.000 Debit Common Stock $82000, credit Land $82.000 0 to search

Explanation / Answer

Common stock = 5,600 shares * 10 per share = 56,000

Land = Fair market value = 82,000

Paid in capital in excess of par value = 82,000 - 56,000 = 26,000

Journal entry

The answer is - Debit land $82,000; credit common stock $56,000; credit paid in capital in excess of par value, common stock $26,000

Land 82,000 Common stock 56,000 Additional paid in capital - Common stock 26,000

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