Prepare the journal entry on december for issuance of shares

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Reference no: EM132779600

Rice Corporation has a stock purchase plan with the following provision.

Each full-time employee with a minimum of one year's service may acquire from Rice Corporation, its common stock, $10 par, through payroll deductions at 5% below the market price on the date selected by the employee for a stock purchase (the exercise date). The exercise decision must be made within one year from the payroll deduction date.
Employee Adams signed a payroll deduction agreement form on January 1, 2020, for $48 per month. At that date, the market price of the stock was $27 per share. At the end of 2020, Adams requested that stock be purchased equal to the amount Adams accumulated as a deposit. At that date, the market price of the stock was $25 per share.

Required

Problem 1: Prepare the journal entry on December 31, 2020, for the issuance of shares to Adams.

Reference no: EM132779600

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