James Yachts Has 2,000 Shares Outstanding Each with a Par

question 2

Multiple Choice

James Yachts has 2,000 shares outstanding each with a par value of $0.07. If they are sold to shareholders at $7 each,what would the capital surplus be?

• A) $10,000
• B) $12,140
• C) $13,250
• D) $13.860
• E) $14,000

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Definitions:

Satisfaction

The fulfillment or discharge of a debt, obligation, or penalty.

Performance

The execution, completion, or fulfillment of a duty, contract, or other obligation according to its terms.

Breach

A breach is the violation of a law, duty, or other form of agreement, typically referring to a breach of contract.

Obligations

Legal or moral duties that require an individual or entity to act or refrain from acting in a certain manner.