Question
The owners of a new venture have decided to organize as a corporation. The initial equity investment is valued at $200,000 reflecting contributions of the
The owners of a new venture have decided to organize as a corporation. The initial equity investment is valued at $200,000 reflecting contributions of the entrepreneur and her family and friends. One hundred thousand shares of stock were initially issued. D.1 What dollar amount would initially be recorded in the common stock account? D.2 If a par value on the common stock was set at $.1 per share, show how the initial equity investment would be recorded D.3Now assume that 30,000 additional shares of stock are sold to an angel investor at $10 per share six months after the initial incorporation. Show how your answer in Part D1 would change if the common stock did not have a par value. Also show how your answer in Part D2 would change given a par value of $.1 per share.
The owners of a new venture have decided to organize as a corporation. The initial equity imvestment is valued at $200,000 reflecting contributions of the entrepreneur and her family and friends. One hundred thousand shares of stock were initiany issued. D.1 What dollar amount would initiolly be recorded in the common stock account? D. 2 If a par walue on the cammon stock was set at $.1 per share, show how the initiol equity investment would be recorded D. 3 Now assume that 30,000 additional shares of stock are sold to an angel investor at $10 per share six months after the initial incorporation. Show how your answer in Part D1 would change if the common stock did not have a par value. Also show how your answer in Part D2 would change given a par vaive of $.1 per share. \begin{tabular}{|l|l|} \hline Common Stock & \\ \hline \end{tabular} \begin{tabular}{|l|l|} \hline Common Stock & \\ \hline AdditionalPaidinCapital & \\ \hline TotalShareholdersEquity & \\ \hline \end{tabular}Step by Step Solution
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