Journal entry for Teal corporation
Account Debit Credit
Cash $37,400
Additional Paid-In Capital $20,900
Common Stock - $5 Par $16,500
(To record issuance of common stock)
Stocks are issues in some states at par value which means that the company sets a minimum price that they can sell stocks at in their articles of incorporation.
Par value is similar to the face value of a bond and, often, companies will sell stocks for more than par value.
First, we need to determine what portion of the cash is at par value first:
= 3,300 x $5
= $16,500
Now, we find what is sold above par:
= $37,400 - $16,500
= $20,900
Finally, we prepare the journal entry:
Account Debit Credit
Cash $37,400
Additional Paid-In Capital $20,900
Common Stock - $5 Par $16,500
(To record issuance of common stock)
Learn more about bond issue here : https://brainly.com/question/25596583
