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Issuing Par Value Common Stock for Cash (assume par value is $1) dr. Cash $1.00 cr. Common Stock $1.00 to record issuance of 1 share of $1 par common stock if sold for more than par value (Assuming $5) dr. Cash $5 cr. Common Stock $1 Paid-in Capital in excess of par $4 to record issuance of 1 share of common stock in excess of par.
Capital amount paid for excess of par value of common stock is called "Share premium amount" which is also part of capital of business.
Is not permitted in most states
Common stock holders do not have the right to choose a stock's par value. That accounting decision lies with the company itself.
premium
False
Par value has no real connection to the worth of common stock. For example, when Starbucks went public, its shares of stock was $0.001 par, but opened at $17 and closed in the same day at $21.50; so if there were 2,500 shares sold at opening, it worth 2,500 x $17 = $42,500, but this has no connection to par value. Assuming the 2,500 shares of common stock sold at par value and the earnings was $100,000.00; the par value would be $100,000 / 2,500 = $40.00
par value of common and preferred stock+additional paid in capital(amount in excess of par)
Cash Common Stock Paid in Capital
A stock's par value is the monetary amount assigned to the share of stock.
the minimum selling price of the stock established by the articles of incorporation
Type your answer here... par value of the stock