How Is Cash Invested by Shareholders in Exchange for Shares

Multiple Choice

How is cash invested by shareholders in exchange for shares initially recorded in the accounting records?

A) As an increase in retained earnings, and an increase in cash.
B) As an increase in long-term investments, and a decrease in cash.
C) As an increase in common shares, and a decrease in cash.
D) As an increase in common shares, and an increase in cash.