Logan Corporation issues 40,000 shares of $50 par value preferred stock for cash at $60 per share.In the stockholders' equity section, the effects of the transaction above will be reported
A)entirely within the capital stock section.
B)entirely within the additional paid-in capital section.
C)under both the capital stock and additional paid-in capital sections.
D)entirely under the retained earnings section.

Question

Quizplus · Accepted Answer

The par value of the stock is recorded in the capital stock section, while the excess over par value ($10 per share) is recorded in the additional paid-in capital section.

Logan Corporation Issues 40,000 Shares of $50 Par Value Preferred