Garrison Company acquired $23,000 by issuing common stock.Which of the following accurately reflects how this event affects the company's financial statements?

A)Option A
B)Option B
C)Option C
D)Option D

Question

Garrison Company acquired $23,000 by issuing common stock.Which of the following accurately reflects how this event affects the company's financial statements?

A)Option A 
B)Option B 
C)Option C 
D)Option D

Quizplus · Accepted Answer

Issuing common stock increases assets (cash)and equity (common stock).It does not affect the income statement,but is reported as a cash inflow for financing activities on the statement of cash flows.

Garrison Company Acquired $23,000 by Issuing Common Stock