Western Wear Clothing issues 3,000 shares of its $0.01 par value common stock to provide funds for further expansion. Assuming the issue price is $11 per share, record the issuance of common stock. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)

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Business

Emmalee Barrett

30 October, 06:55

Western Wear Clothing issues 3,000 shares of its $0.01 par value common stock to provide funds for further expansion. Assuming the issue price is $11 per share, record the issuance of common stock. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)

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Malia Torres · Answer 1

The journal entry for the issuance of the common stock is shown below:

Explanation:

Cash A/c ... Dr $33,000

Common Stock A/c ... Cr $30

Paid in Capital A/c ... Cr $32,970

Working Notes:

Cash = Number of shares * Issue Price

= 3,000 * $11

= $33,000

Common Stock = Number of Shares * Par Value

= 3,000 * $0.01

= $30

Paid in Capital = Cash - Common stock

= $33,000 - 30

= $32,970