If Lantz Company Issues 10,000 Shares of $5 Par Value

question 92

Multiple Choice

If Lantz Company issues 10,000 shares of $5 par value common stock for $210,000, the account

• A)Common Stock will be credited for $50,000.
• B)Paid-in Capital in Excess of Par Value will be credited for $50,000.
• C)Paid-in Capital in Excess of Par Value will be credited for $210,000.
• D)Cash will be debited for $160,000.

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Definitions:

Central Authority

A governing body or organization that holds the primary power and control over a specified collective or region, often tasked with decision-making and regulation duties.

Production Frontier

Also known as the production possibility frontier, it illustrates the maximum possible output combinations of two goods or services a business can achieve with its current resources and technology.

Market System

A system where economic decisions and the pricing of goods and services are guided purely by the interactions of a country's individual citizens and businesses.

Centrally Planned System

An economic system in which decisions about production and distribution are made by a centralized authority rather than by market forces.