If a Company Issues 1,000 Shares of $4 Par Value

Multiple Choice

If a company issues 1,000 shares of $4 par value common stock at a market price of $120 per share, which of the following is the correct balance sheet entry?

A) Increase cash by $120,000 and increase earned capital by $120,000
B) Increase revenues by $120,000
C) Increase cash by $120,000 and increase contributed capital by $120,000
D) Increase common stock and cash by $4,000