A Capital Surplus Is Obtained When the Selling Price of New

question 80

True/False

A capital surplus is obtained when the selling price of new shares is greater than the par value.

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Definitions:

Credit Balance

Credit Balance refers to the amount of money a company owes to its customers, creditors, or depositors in their respective accounts.

Credits

Accounting entries that decrease assets or increase liabilities and equity on the balance sheet.

Debits

In accounting, debits are entries on the left side of an account ledger, indicating increases in asset or expense accounts, or decreases in liability, equity, or revenue accounts.

Credit

An accounting entry that represents an increase in liabilities or equity or a decrease in assets, opposite of a debit.