Which of the following shows how acquiring cash from the iss

Which of the following shows how acquiring cash from the issue of common stock will affect a company’s financial statements?

Which of the following shows how acquiring cash from the issue of common stock will affect a company’s financial statements?

Balance Sheet Assets= Liab. +Equity NA Statement of Cash Flows NA Income Statement Rev.. Exp.= Net Inc. NA NA NA

Solution

Answer is C.

Cash acquired by issuing common stoock will have following effects:

(i) Increase in Cash
(ii) Increase in Common Stock
(iii) Issuing of common stock is a cash inflow from financing activity

So, only Option C is showing above effects properly.