Power Net Company is authorized to issue 50,000 shares of common stock. On August 1, the company

Question:

Power Net Company is authorized to issue 50,000 shares of common stock. On August 1, the company issued 2,500 shares at $25 per share. Prepare entries in Journal form to record the issuance of stock for cash under each of the following alternatives:

1. The stock has a par value of $25.

2. The stock has a par value of $10.

3. The stock has no par value.

4. The stock has a stated value of $1 per share.

Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...