A company issues 100,000 shares of \$1 par value common stock for legal services valued at \$120,000. What is the journal entry to record this transaction?

• A. Debit Legal Expense \$120,000; Credit Common Stock \$100,000; Credit APIC \$20,000.
• B. Debit Legal Expense \$100,000; Credit Common Stock \$100,000; Credit APIC \$20,000.
• C. Debit Legal Expense \$120,000; Credit Common Stock \$120,000.
• D. Debit Legal Expense \$120,000; Credit APIC \$120,000.

Answer: (A)