Question

Columbia Clay, Inc. issues 2 million shares of preferred stock with a par value of $2...

Columbia Clay, Inc. issues 2 million shares of preferred stock with a par value of $2 at its market price of $26 per share. The issuance should be recorded with a debit to Cash for:

Multiple Choice

$52 million and a credit to Preferred Stock for $52 million.

$4 million and a credit to Preferred Stock for $4 million.

$52 million, a credit to Additional Paid-in Capital for $4 million, and a credit to Preferred Stock for $48 million.

$52 million, a credit to Preferred Stock for $4 million, and a credit to Additional Paid-in Capital for $48 million.

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