Which one of the following changes describes the receipt of $3,000 from the issuance of common stock?

Question

Quizplus · Accepted Answer

The issuance of common stock is a transaction that involves the sale of ownership in the company to investors. This increases the company's assets by the cash received from the sale and increases shareholders' equity by the same amount, since the investors now own a portion of the company. Therefore, both assets and shareholders' equity increase by $3,000.

Which One of the Following Changes Describes the Receipt of $3,000