1. Exercise 10-60 (Algorithmic) Issuing Common Stock

   Thoman Products, Inc., sold 22,850 shares of common stock to stockholders at the time of its incorporation. Thoman received $24.40 per share for the stock.

   Required:

   1. Assume that the stock has a $20 par value per share. Prepare the journal entry to record the sale and issue of the stock.

   	Accounts Payable Accounts Receivable Additional Paid-In Capital-Common Stock Cash Common Stock
   	Accounts Payable Cash Common Stock Retained Earnings Treasury Stock
   	Accounts Receivable Additional Paid-In Capital-Common Stock Additional Paid-In Capital-Preferred Stock Cash Retained Earnings
   	(Record sale of common stock)

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   2. Assume that the stock has a $15 stated value per share. Prepare the journal entry to record the sale and issue of the stock.

   	Accounts Receivable Additional Paid-In Capital-Common Stock Cash Common Stock Retained Earnings
   	Accounts Payable Cash Common Stock Preferred Stock Treasury Stock
   	Accounts Receivable Additional Paid-In Capital-Common Stock Additional Paid-In Capital-Preferred Stock Cash Retained Earnings
   	(Record sale of common stock)

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   3. Assume that the stock has no par value and no stated value. Prepare the journal entry to record the sale and issue of the stock.

   	Accounts Receivable Additional Paid-In Capital-Common Stock Cash Common Stock Retained Earnings
   	Accounts Receivable Additional Paid-In Capital-Common Stock Cash Common Stock Retained Earnings
   	(Record sale of common stock)

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   4. Conceptual Connection: How do the different par values affect total contributed capital and total stockholders' equity?

   The different par values

   • increase
   • decrease
   • have no effect on
   total capital stock or total stockholders equity.