A company issued 70 shares of $30 par value preferred stock for $4,000 cash. The journal entry to record the issuance is:
A. Debit Preferred Stock $2,100, debit Investment in Preferred Stock $1,900; credit Cash $4,000.
B. Debit Cash $4,000; credit Preferred Stock $4,000.
C. Debit Cash $2,100; credit Preferred Stock $2,100.
D. Debit Cash $4,000; credit Paid-in Capital in Excess of Par Value, Preferred Stock $1,900, credit Preferred Stock $2,100.
E. Debit Investment in Preferred Stock $2,100; credit Cash $2,100.
Answer: D
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