Match each transaction with its effect on the accounting equation. Each letter may be used more than once.
-Payment for common stock by stockholder
A)Increase assets, increase liabilities
B)Increase liabilities, decrease stockholders' equity
C)Increase assets, increase stockholders' equity
D)No effect
E)Decrease assets, decrease liabilities
F)Decrease assets, decrease stockholders' equity

Question

Quizplus · Accepted Answer

Payment for common stock by a stockholder represents an increase in assets (cash) and an increase in stockholders' equity (common stock). Therefore, the correct choice is C - Increase assets, increase stockholders' equity.

Match Each Transaction with Its Effect on the Accounting Equation