Assume Common Stock Is Issued to Employees as a Result

question 141

Multiple Choice

Assume common stock is issued to employees as a result of exercising stock purchase rights issued under a noncompensatory share purchase plan. Which of the following accurately describes the effect on the company's income, paid-in capital, and retained earnings, respectively?

• A) decreased, increased, and decreased
• B) no effect, increased, and increased
• C) decreased, increased, and no effect
• D) no effect, increased, and no effect

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Definitions:

Developing Countries

Nations with a lower living standard, underdeveloped industrial base, and low Human Development Index relative to other countries.

Environment Degrade

The process by which the natural environment deteriorates due to human activity or natural events, leading to negative impacts on ecosystems and human health.

Cross-Border Flows

The movement of goods, capital, services, people, and data across international borders.

Foreign Direct Investment

Funds deployed by an individual or company from one nation into the business ventures of another country, through the initiation of business activities or the acquisition of business properties.