Gothic Architecture is a new chain of clothing stores specializing in the color

Question

Gothic Architecture is a new chain of clothing stores specializing in the color black. Gothic issues 1,200 shares of its $3 par value common stock at $24 per share.

Record the issuance of the stock. How would the entry differ if Gothic issued no-par value stock? (If no entry is required for a particular event, select "No journal entry required" in the first account field.)

Gothic Architecture is a new chain of clothing stores specializing in the color black. Gothic issues 1,200 shares of its $3 par value common stock at $24 per share.

Explanation / Answer

Hi,

Please find the detailed answer as follows:

Part A: Issued with Par Value

Cash (1200*24) Dr. 28800

Common Stock (1200*3) Cr. 3600

Additional Paid in Capital (1200*21) Cr. 25200

Part B: No Par Value Stock

Cash (1200*24) Dr. 28800

Common Stock (1200*24) Cr. 28800

Additional Paid in Capital - No Entry Required

Thanks.

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