Penny's Cafe Began Operations on March 1,2012

question 47

Multiple Choice

Penny's Cafe began operations on March 1,2012.The corporate charter authorized the issuance of 3,000 shares of $2 par value common stock and 1,000 shares of $3 par value,8% cumulative preferred stock.The company's fiscal year ends on February 28.Penny's sold 500 shares of common stock at $6 per share on April 1.What impact does the entry to record the April 1 transaction have on total stockholders' equity?

• A)No effect
• B)Increase by $1,000
• C)Increase by $3,000
• D)Increase by $6,000

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Definitions:

Substance Abuse

The continued use of a psychoactive substance even though it is causing or increasing problems in a person’s life.

Counsel

Providing advice or guidance on personal or psychological matters.

Supervisors

Individuals who oversee and direct the work of others within an organization.

Physical

Relating to the body as opposed to the mind or emotions, or relating to material things rather than spiritual ones.