When common stock is issued at an amount greater than par value, the difference between the par value and the proceeds from the sale is recorded by

A) crediting the common stock account
B) debiting an additional paid-in capital account
C) crediting the retained earnings account
D) crediting an additional paid-in capital account

Par Value

The face value of a bond or stock as stated by the issuing company, unrelated to its market value.

Common Stock

A form of corporate equity ownership, a type of security representing ownership in a corporation and a claim on part of the corporation's profits or losses.

Paid-in Capital

Funds received from investors during the issuance of stock, exceeding the par or stated value of the shares, also known as "contributed capital."