
Common stock: These are the ordinary shares that a corporation issues to the investors in order to raise funds. In return, the investors receive a share of profit from the profits earned by the corporation in the form of dividend.
Par value: It refers to the value of a stock that is stated by the corporation’s charter. It is also known as face value of a stock.
Issue of common stock for non-cash assets or services: Corporations often issue common stock for the services received from attorneys or consultants as compensation, or for the purchase of non-cash assets such as land, buildings, or equipment.
To journalize: the transactions.

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Chapter 12 Solutions
Bundle: Financial & Managerial Accounting, 14th + Working Papers for Warren/Reeve/Duchac's Corporate Financial Accounting, 14th + Working Papers, ... & Managerial Accounting, 14th + CengageNOWv2,
- Helparrow_forwardDuring the current year, a business sells equipment for $440,000. The equipment cost $290,000 when purchased and placed in service two years ago and $85,000 of depreciation deductions were allowed. The results of the sale are ____. OPTIONS: A) Ordinary income of $85,000 and Sec. 1231 gain of $150,000. B) Sec. 1231 gain of $120,000. C) Ordinary income of $90,000 and LTCL of $30,000. D) Ordinary income of $120,000.arrow_forwardPlease give me true answer this financial accounting questionarrow_forward
- General Accountingarrow_forwardProvide correct answer this financial accounting questionarrow_forwardQuestion: A company sells goods on credit. On one sale, they sold it for $20,000 and offered a 2/10, net/30 payment option. Two days after the sale, the customer complained and they allowed them a $1,000 sales allowance. The customer paid the net amount within 8 days after the sale. The cash proceeds received by the seller are? A. $20,000 B. $19,000 C. $18,600 D. $18,620arrow_forward
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