A New Company Issues 2,000 Shares of $5 Par Common

question 114

Multiple Choice

A new company issues 2,000 shares of $5 par common stock in exchange for the services of a lawyer during its first month of business.The lawyer's normal fee is $15,000 for similar work.Which of the following would be recorded if the stock is not currently trading?

• A) A debit to Common Stock for $10,000
• B) A credit to Common Stock for $15,000
• C) A debit to Additional Paid-In Capital-Common Stock of $5,000
• D) A credit to Additional Paid-In Capital-Common Stock of $5,000

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Definitions:

Job Rotation

A strategy where employees rotate between different positions within an organization to learn new skills and gain varied experience.

Effective Types

Refers to various categories or methods that have been proven through results or research to achieve desired outcomes efficiently.

Mentoring

Mentoring is a personal developmental relationship where a more experienced or knowledgeable person helps to guide a less experienced or less knowledgeable person.

Stand-Alone Method

A technique or intervention that is used independently rather than in combination with other methods.