A Company Sells 1 Million Shares of Stock with No

question 60

Multiple Choice

A company sells 1 million shares of stock with no par value for $15 a share. In recording the transaction, it would:

• A) debit Cash for $20,000 and credit Common Stock for $20,000.
• B) debit Cash for $15 million and credit Common Stock for $15 million.
• C) debit Cash for $15 million, credit Common Stock for $20,000 and credit Additional Paid-in Capital for $14,980,000.
• D) debit Cash for $20,000, debit Capital Receivable for $14,980,000, credit Common Stock for $20,000 and credit Additional Paid-in Capital for $14,980,000.

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Definitions:

Myelin

A fatty substance that insulates the axon and allows it to send nerve impulses quickly.

Schwann cells

Specialized cells located in the peripheral nervous system, responsible for the formation of myelin sheaths around neurons, facilitating rapid signal transmission.

Axons

Long threadlike part of a nerve cell along which impulses are conducted from the cell body to other cells.

Myelinated axons

Nerve fibers covered in myelin, a protective sheath that speeds up the transmission of electrical signals in the nervous system.