Asked by Selia Bennett on Jun 11, 2024
Verified
Excess of Issue Price over Par (Common) = Excess Price of Common Stock × Number of Shares of Common Stock Issued =
($12 - $2) × 10,000 = $100,000
A) Treasury stock
B) Retained earnings
C) Preferred stock
D) Excess of issue price over par (preferred)
E) Common stock
F) Total paid-in capital
G) Excess of issue price over par (common)
H) Total stockholders' equity
Issue Price Over Par
A scenario where the sale price of a security is higher than its nominal or face value at the time of issuance.
Common Stock
A type of equity security that represents ownership in a corporation, with holders having voting rights and potentially receiving dividends.
Shares
Units of ownership interest in a corporation or financial asset, affording certain rights such as dividends and voting rights.
- Master the method and relevance of retained earnings in association with stockholders' equity.
Verified Answer
VI
Veronica IsabelJun 17, 2024
Final Answer :
G
Explanation :
The calculation provided directly matches the definition of "Excess of issue price over par (common)," which is the amount by which the selling price of common stock exceeds its par value, multiplied by the number of shares issued.
Learning Objectives
- Master the method and relevance of retained earnings in association with stockholders' equity.