Q22E_2 - Horngren'S Financial And Managerial Accounting

Question

Eates Corp. issued 8,000 shares of no-par common stock for $13 per share.

Requirements

2. Which type of stock results in more total paid-in capital?

Step-by-Step Solution

Answer

The common stock for $3 per share has more paid-in capital.

Step 1: Basic Introduction

Paid-in capital is the value determined when common stock value is reduced from the cash received ($104,000- $24,000) or (8,000* $10)

Step 2: Type of stock

The stock that value of $3 per share have the more Paid-in capital- in excess of par i.e., $80,000