How do you calculate additional paid-in capital using just common stock?
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How do you calculate additional paid-in capital using just common stock?
When you issue a common stock there should be a par value for the stock, usually $1. now lets assume that you issued (sold) 100 common stock for $5 you will perform the following entry
Debit cash 500
Credit common stock (for the par value) 100
Credit Additional paid in capital for the excess $4 400
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