Miller corporation issued 7000 shares of its $5 par value common stock in payment for attorney services billed at $70,000. miller corporation's stock has been actively trading at $10 per share. the journal entry for this transaction would include a credit to: select one:
a. common stock for $70,000
b. paid-in capital in excess of par-common for $70,000.
c. paid-in capital in excess of par-common for $35,000.
d. legal expense for $70,000.

C. Paid-in Capital in Excess of Par-Common for $35,000.

Explanation:

The journal entry include

The common stock

= Number of shares × par value of share

= 7,000 shares × $5

= $35,000

Since the attorney services billed at $70,000 out of which the common stock value is $35,000 so the remaining balance $35,000 ($70,000 - $35,000) would be transferred to the Paid-in Capital in Excess of Par-Common

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