Question

If baldwin issued 1000 shares of common stock at last year's end price, the effect on the balance sheet would be

Answer 1

 

The solution would be like this for this specific problem:

Given: 1000 Shares

$60.52 Share Price   So:   = 1,000 * $60.52 = $60,520.00     If Baldwin issued 1000 shares of common stock at last year's end price, the effect on the balance sheet would be: equity would increase by $60,521.

Answer 2

The Equity would increase in the balance sheet when Baldwin issued 1000 shares of common stock at last year's end price.

The effect of purchasing common stock

The financial statement would be credited when a company purchases common stock as it increases the capital of the business.

Hence, the equity shareholder account at the right side of the balance sheet would increase the asset of the company.

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