Answer:
The Journal entry is as follows:
Cash A/c Dr. $29,700
To common stock $27
To Additional Paid in Capital in excess of par - Common Stock $29,673
Workings:
Shares issued = 2,700
Par value common stock to provide funds for further expansion = $0.01
Issue price = $11 per share
cash = Shares issued × Issue price per share
= 2,700 × $11
= $29,700
Common Stock = Shares issued × Par value common stock
= 2,700 × $0.01
= $27
Additional Paid in Capital in excess of par - Common Stock:
= cash - Common Stock
= $29,700 - $27
= $29,673
