Is it possible;

              Bulletin HASKINS & SELLS 53
Is It Possible?
CONVENTION plays such an impor­tant
part in affairs generally that even
accounting does not escape its grasp. The
conventional balance sheet has certain
specifications, though in many respects
financial statements are far from having
reached a standardized stage. One of
these notable particulars is the manner of
expressing capital stock having a fixed
par value. Convention requires that the
capital of a corporation having capital
stock of this kind shall be represented as
the par value of its stock even though
some nominal asset like good will has to be
created to take up the slack between real
value received and the par value of stock
issued in exchange therefor. The reason
for the practice can be traced to those
laws which make stockholders liable for
assessment under certain circumstances
for the difference between value given by
them and the par value of their stock.
Now comes a corporation organized
under the laws of Virginia, having pre­ferred
and common issues, both with par
value and a comparatively small surplus,
which wishes to redeem the entire pre­ferred
issue at a premium out of the pro­ceeds
of further sales of common and
charge the premium against the common
capital stock account instead of against
surplus.
The conventionalists would, of course,
raise their hands in holy horror, but
thoughtful consideration of the matter
seems to find no reason why it should not
be done; provided it is done in the proper
way.