Investments by stockholders are recorded in the Common Stock account,not in the Retained Earnings account.

Question

Quizplus · Accepted Answer

Common Stock is the account that represents the initial investment by stockholders in a corporation, while Retained Earnings represent the accumulated profits or losses of the company. Therefore, investments by stockholders are recorded in the Common Stock account, not in the Retained Earnings account.

Investments by Stockholders Are Recorded in the Common Stock Account,not