The Grandview Company issues 1 million shares of common stock with a par value of $0.12 for $16.00 a share. The entry to record this transaction includes a debit to Cash for:

$16,000,000

Explanation:

This question requires us to give the amount arising in cash assets after this transaction.

We simply have to focus on the price offered for the share on the date of sale which is $16.00. Thus, cash proceeds (debited) will be :

Cash Proceeds = Share Price × Number of Shares issued

                          = $16.00 × 1,000,000 shares

                          = $16,000,000

The rest of the Journal entry for this transaction will be :

Debit : Cash ($16.00 × 1,000,000) $16,000,000

Credit : Common Stock ($0.12 × 1,000,000 shares)  $120,000

Credit : Paid In Excess of Par ($15,88 × × 1,000,000 shares) $15,880,000

answer; specific performance;