Michael Hudson Owns 400 Shares of Surefoot Enterprises

Multiple Choice

Michael Hudson owns 400 shares of Surefoot Enterprises.The capital stock of Surefoot Enterprises has a par value of $8 per share.Michael Hudson sells his 400 shares of Surefoot Enterprises stock to Brian Haas for $15 per share.The effect of this transaction on Surefoot Enterprises,would be to

A) increase the cash account by $6,000 and increase the capital stock account by $6,000.
B) increase the cash account by $6,000 and decrease the capital stock account by $6,000.
C) increase the cash account by $6,000,increase the capital stock account by $3,200,and increase the paid-in capital in excess of par account by $2,800.
D) Surefoot Enterprises would not record this transaction but would note the change in ownership.
E) Surefoot Enterprises records this transaction but would not note the change in ownership.