Osbourne Company Issued 50,000 Shares of Common Stock in Exchange

question 167

Multiple Choice

Osbourne Company issued 50,000 shares of common stock in exchange for manufacturing equipment. The equipment was valued at $1,000,000. The stock has par value of $0.01 per share. The entry to record this transaction would include which of the following line items?

• A) Debit Cash $5,000.
• B) Credit Gain on sale of common stock $1,050,000.
• C) Credit Paid-in capital $999,500.
• D) Credit Common stock $1,000,000.

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Definitions:

Well-Organized Manner

A methodical and structured approach to arranging or presenting information.

Business Communication

The sharing of information between people within and outside an organization that is performed for the commercial benefit of the organization.

Scope

The extent or range of view, outlook, application, operation, or effectiveness of an object or concept.

Business Message

Any form of communication used within a professional setting to convey information, decisions, or requests.