On January 2 2016 Alpha Corporation issued 5000 shares of 35

On January 2, 2016, Alpha Corporation issued 5,000 shares of $3.50 par value common stock. The issue price was $9.50 per share. Use this information to prepare the General Journal entry (without explanation) for the January 2 entry.

Solution

January 2, 2016. Bank A/c dr. 47500

To share capital/Stock. 17500

To securities premium. 30000

(Being shares issued at premium)

The stock account is credited with par value i.e. 5000*3.5. And securities premium account with balance amount received.