Asked by louis rojas on Jul 27, 2024
Verified
The journal entry to record the final installment from a common stock subscription is:
A) a debit Cash and a credit to Paid in Capital in Excess of Par Value-Common Stock.
B) a debit to Subscriptions Receivable-Common Stock and a credit to Cash.
C) a debit to Cash and a credit to Subscriptions Receivable-Common Stock.
D) a debit to Common Stock Subscribed and a credit to Cash.
Subscriptions Receivable-Common Stock
An account that tracks the amount due from subscribers who have committed to purchasing a company's common stock but have not yet paid.
Common Stock Subscribed
Common stock subscribed is a term used to describe an agreement by investors to purchase common stock, a type of equity, from a company.
- Document activities associated with stock subscriptions and their financial collections.
Verified Answer
ZK
Zybrea KnightAug 03, 2024
Final Answer :
C
Explanation :
When the final installment from a common stock subscription is received, the company debits Cash (to increase cash for the amount received) and credits Subscriptions Receivable-Common Stock (to decrease the receivable since the installment has been paid).
Learning Objectives
- Document activities associated with stock subscriptions and their financial collections.