AMB Company's tabular analysis at the beginning of October consisted of the following balances: During October the company issued additional shares of stock for proceeds of $2000.How would this transaction be recorded in the tabular analysis?

Question

AMB Company's tabular analysis at the beginning of October consisted of the following balances:  During October the company issued additional shares of stock for proceeds of $2000.How would this transaction be recorded in the tabular analysis?

Quizplus · Accepted Answer

Issuing additional shares of stock generates cash for the company. Therefore, Cash is increased by $2000. At the same time, the company would issue new shares of common stock, which would increase the Common Stock account by $2000. Therefore, the transaction would be recorded as an increase in Cash and an increase in Common Stock, making choice D the correct answer.

AMB Company's Tabular Analysis at the Beginning of October Consisted