Question

Flagler Corporation shows a total of $625,000 in its common stock account and $1,100,000 in its paid-in capital in excess of par value – common stock account. The par value of Flagler's common stock is $5. How many shares of Flagler stock have been issued?

Answer 1

Answer:

125,000 shares

Explanation:

The computation of the issued shares are shown below:

Issued shares = Total common stock account balance  ÷ Par value per share of common stock

                       = $625,000 ÷ $5

                       = 125,000 shares

Simply we divide the total common stock account balance by the Par value per share so that the correct value of shares can come.

All other information which is given is not relevant. Hence, ignored it