DAE Parts Shop began business on January 1, 2011 The corporate charter authorized issuance of 20,000 shares of $5 par value common stock and 5,000 shares of $10 par value, 5 percent cumulative preferred stock DAE issued 12,000 shares of common stock at $25 per share on January 2, 2011 What effect d...

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DAE Parts Shop began business on January 1, 2011. The corporate charter authorized issuance of 20,000 shares

Question:

DAE Parts Shop began business on January 1, 2011. The corporate charter authorized issuance of 20,000 shares of $5 and 5,000 shares of $10 5 percent cumulative preferred stock. DAE issued 12,000 shares of at $25 per share on January 2, 2011. What effect does the entry to record the issuance of stock have on total stockholders’ equity?
a. Increase of $120,000
b. Increase of $150,000
c. Increase of $300,000
d. Increase of $340,000 Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...