Answer:
This question is incomplete. I tried looking for the full question but i could not find it.
However, I have provided the notes below to help you with important principles on the issuance of Par Value stated Preference Stock.
Notes :
It is important to remember that any amount paid in excess of par value when it comes to par value stated stocks is accounted for in a stock premium reserve.
Journal Entry to record issuance of preferred stock is :
Cash $4,000 (debit)
Preference Stock $3,200 (credit)
Paid In Excess of Par $800 (credit)
Thus, of the $5 , 1$ was paid in excess and the total to go in the reserve is $800.
