Peterson,Inc

question 155

Multiple Choice

Peterson,Inc.issued 4,000 shares of preferred stock for $280,000.The stock has a par value of $70 per share.The journal entry to record this transaction would ________.

• A)credit Cash $280,000,debit Preferred Stock-$70 Par Value $4,000,and debit Paid-In Capital in Excess of Par-Preferred $276,000
• B)debit Cash $280,000,credit Preferred Stock-$70 Par Value $4,000,and credit Paid-In Capital in Excess of Par-Preferred $276,000
• C)credit Cash $280,000 and debit Preferred Stock-$70 Par Value $280,000
• D)debit Cash $280,000 and credit Preferred Stock-$70 Par Value $280,000

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Definitions:

Annuity

An annuity is a financial product that pays out a fixed stream of payments to an individual, typically used as a retirement strategy to provide steady income.

Equal Payments

Regular payments of the same amount over the course of a loan's term or fixed investment period, often associated with mortgages or annuities.

Time Intervals

Periods or durations between two points or events in time.

Amortized Loan

A loan with scheduled periodic payments that include both principal and interest.