Question

A company issued 260 shares of $100 par value common stock for $31,000 cash. The total amount of paid-in capital in excess of par is:

Answer 1

Answer:

The total amount of paid-in capital in excess of par is: $5,000.

Explanation:

When Common Stocks are classified as par value Stocks, any price paid in excess of the par value of the Stock is accounted for in the Share Premium account.

Here is the Summary of the Transaction provided.

Common Stocks : 260 shares × $100 = $26,000

Paid-in capital in excess of par : $31,000 - $26,000 = $5,000