Question

On May 25, Tyler, Inc. issues 100 shares of $10 par value preferred stock for $5,000 cash. The entry to record this transaction would include a (debit/credit) ________ to the preferred stock account in the amount of

Answer 1

The entry to record this transaction would include a Credit to the preferred stock account in the amount of $1,000.

Prefered stock account

Based on the information given the appropriate journal entry to record the transaction is:

Tyler, Inc. Journal entry

Debit Cash $1,000

Credit Preferred stock account $1,000

(100 shares×$10 per value)

(To record preferred stock)

Therefore the entry to record this transaction would include a Credit to the preferred stock account in the amount of $1,000.

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