Question

Windsor, Inc. issues 31000 shares of $100 par value preferred stock for cash at $115 per share. The entry to record the transaction will consist of a debit to Cash for $3565000 and a credit or credits to Paid-in Capital from Preferred Stock for $3565000. Preferred Stock for $3565000 Preferred Stock for $3100000 and Paid-in Capita in Excess of Par Value-Preferred Stock for $465000 Preferred Stock for $3100000 and Retained Earnings for $348750

Answer 1

Dear student, only one question is allowed at a time. I am answering the first question

When a stock is issued above par value, the excess amount received is credited to Paid-In Capital in excess of par value

Amount received for preferred stock of $115 will be divided into capital received for preferred stock at $100 and Paid-In Capital in excess of par value at $15 per share

Amount received for capital

= Number of shares x Par value per share

= 31,000 x $100

= $ 3,100,000

Amount received for Paid-In Capital in excess of par value

= 31,000 x ($115 - $100)

= $ 465,000

So, the correct option is option C