The Issuance of Common Stock for Cash Would Be Recorded

question 93

Multiple Choice

The issuance of common stock for cash would be recorded by a ________.

• A) credit to Retained Earnings
• B) credit to Common Stock
• C) debit to Investments
• D) credit to Revenues

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Definitions:

Consumer Surplus

The separation between what consumers envisage paying for a good or service and the amount they actually disburse.

Producer Surplus

The gap between the price that sellers are ready to take for a product or service and the actual price they get from the market.

Deadweight Loss

An economic inefficiency that arises when the balance for a product or service is either not attained or cannot be attained.

Consumer Surplus

The differential between the overall amount consumers are willing and financially prepared to spend on a good or service, and what they end up spending.