The correct answer is: Additional Paid-in Capital.

Here's why:

When a company issues shares at a price greater than the par value, the excess amount over the par value is credited to an equity account called "Additional Paid-in Capital" (also known as share premium). This account represents the extra amount that investors were willing to pay over the par value of the shares.

1. Common Stock: This account is usually credited with the par value of the shares issued, not the excess over par value.

2. Treasury Stock: This account is used when a company buys back its own shares from the open market. It has no relation to shares being issued at a price greater than par value.

3. Retained Earnings: This account represents the accumulated net income of the company that has been retained for reinvestment in the business, rather than paid out as dividends. It is not related to the issuance of shares.

4. Additional Paid-in Capital: This is the correct account to credit when shares are issued at a price greater than par value.

Question

The correct answer is: Additional Paid-in Capital.

Here's why:

When a company issues shares at a price greater than the par value, the excess amount over the par value is credited to an equity account called "Additional Paid-in Capital" (also known as share premium). This account represents the extra amount that investors were willing to pay over the par value of the shares.

1. Common Stock: This account is usually credited with the par value of the shares issued, not the excess over par value.

2. Treasury Stock: This account is used when a company buys back its own shares from the open market. It has no relation to shares being issued at a price greater than par value.

3. Retained Earnings: This account represents the accumulated net income of the company that has been retained for reinvestment in the business, rather than paid out as dividends. It is not related to the issuance of shares.

4. Additional Paid-in Capital: This is the correct account to credit when shares are issued at a price greater than par value.

Knowee AI · Accepted Answer

The correct answer is: Additional Paid-in Capital.

Here's why:

When a company issues shares at a price greater than the par value, the excess amount over the par value is credited to an equity account called "Additional Paid-in Capital" (also known as share premium). This account represents the extra amount that investors were willing to pay over the par value of the shares.

1. Common Stock: This account is usually credited with the par value of the shares issued, not the excess over par value.

2. Treasury Stock: This account is used when a company buys back its own shares from the open market. It has no relation to shares being issued at a price greater than par value.

3. Retained Earnings: This account represents the accumulated net income of the company that has been retained for reinvestment in the business, rather than paid out as dividends. It is not related to the issuance of shares.

4. Additional Paid-in Capital: This is the correct account to credit when shares are issued at a price greater than par value.

If shares of common stock are issued at a market price greater than par value, the amount in excess of par should be credited to:Multiple ChoiceCommon Stock.Treasury Stock.Retained Earnings.Additional Paid-in Capital.

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