Bodkin Beverage Company Is Authorized to Issue 20000 Shares of 8

Short Answer

Bodkin Beverage Company is authorized to issue 20000 shares of 8% $100 par value preferred stock and 500000 shares of no-par common stock with a stated value of $1 per share. If Bodkin issues 12000 shares of common stock to pay its recent attorney's bill of $50000 for legal services on a land access dispute which of the following would be the journal entry for Bodkin to record? a.
$\begin{array}{llr} \text {Legal Expense } &12,000\\ \text { Common Stock} &&12,000\\\end{array}$

b.
$\begin{array}{llr} \text {Legal Expense } &50,000\\ \text { Common Stock } &&50,000\\ \text { } &\end{array}$

c.
$\begin{array}{llr} \text { Legal Expense } &50,000\\ \text { Common Stock} &&12,000\\ \text { Paid-in Capital in Excess of Stated Value -Common } &&38,000\end{array}$

d.
$\begin{array}{llr} \text { Legal Expense } &50,000\\ \text { Common Stock } &&12,000\\ \text { Paid-in Capital in Excess of Par - Preferred } &&38,000\end{array}$