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Accounting for common stock issued with other securities (preferred stock) as a lump sum sale, comparing the proportional method with the incremental method to allocate the receipts on the lump sum sale, using the proportional method to allocate the proceeds from the sale of common stock and preferred stock so together as a unit, the proportional method is used when the fair value of both (all) securities are known, the fair value of each security is divided by the total fair value of the combined securities to determine the proportional amount assigned to each security, the proportional amount multiplied by the total receipts determines the receipts allocated to each security, the incremental method is used when the fair value of one of the securities is known and the other is not, the value of the known security becomes the basis for the allocation of the proceeds received, the difference between the total amount of the lump sum sale and the known security, the balance is assigned to the security with the unknown fair value, detailed accounting by Allen Mursau