Big Centex Corporation issued 2,000 shares of $10 par value common stock at $17 per share. When the transaction is recorded, credits are made to: Group of answer choices Common Stock, $34,000 Cash, $34,000 Common Stock, $20,000 and Paid-In Capital in Excess of Par Value, $14,000 Common Stock, $14,000 and Paid-In Capital in Excess of Par Value, $20,000

Big Centex Corporation

When the transaction is recorded, credits are made to:

Common Stock, $20,000 and Paid-In Capital in Excess of Par Value, $14,000

Explanation:

a) Data and Calculations:

Issue of shares = 2,000

Par value of common stock = $10

Issue price = $17 (shares are issued at a premium of $7 per share.)

Common stock value = $20,000 (2,000 * $10)

Paid-in Capital in Excess of Par Value = $14,000 (2,000 * $7)

b) The shares of Big Centex Corporation have been issued at a premium, that is at a value or price which is above the par value of $10.  The premium is $7.  Therefore, the Common Stock will be credited with $20,000 representing the par value of the issued stock while the Paid-In Capital in Excess of Par Value will be credited with the excess or premium.  These separate credits separate the premium per share from the par value of the issued shares.

answer; i believe the correct answer is (business necessity defense;

anjan should should report alteast 5000 on the first apyment and 10,000 each year

explanation: