If Stock Is Issued for Less Than Par Value, the Account

question 171

Multiple Choice

If stock is issued for less than par value, the account

• A) Paid-In Capital in Excess of Par Value is credited.
• B) Paid-In Capital in Excess of Par Value is debited if a debit balance exists in the account.
• C) Paid-In Capital in Excess of Par Value is debited if a credit balance exists in the account.
• D) Retained Earnings is credited.

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Definitions:

LIFO

An acronym for "Last In, First Out," a method used in inventory management and accounting to value inventory and calculate cost of goods sold.

Taxable Income

Taxable income is the amount of an individual's or a company's income used to calculate how much tax they owe to the government in a given tax year.

Tax Advantage

Financial benefits granted by government taxation policies, such as deductions, exclusions, or credits, to encourage certain activities or investments.

Net Realizable Value

The estimated selling price of goods minus the cost of their sale or completion.