Percy Corporation was formed on January 1. The corporate charter authorized 100,000 shares of $10 par value common stock. During the first month of operation, the corporation issued 210 shares to its attorneys in payment of a $4,100 charge for drawing up the articles of incorporation. The entry to record this transaction would include .

Debit to organization expenses for $4100 (legal expenses)

Explanation:

Format: Account  |  Credit  |  Debit   |  Explanation

Organization Expenses  |   -   |  $4100  |  Legal expenses

Common Stock   |   $2100   |   -    |  210*$10 = $2100

Additional paid-in Capital  |  $2000   |    -    |  Contributed capital in excess of par value, common stock

The entry to record this transaction would include debit to organization expenses for $4100 (legal expenses).