Indicate how each event affects the elements of financial statements. Use the following letters to record your answer in the box shown below each element. You do not need to enter dollar amounts. (Note that "Not Affected" means that the event does not affect that element of the financial statements or the event causes an increase in that element that is offset by a decrease in the same element.)Increase = IDecrease = DNot Affected = NAAtlantic Oil Company had 10,000,000 common shares outstanding. The shares had been issued at $14 per share. The stock of Atlantic Oil Co. was trading at $14 per share on March 27 when the company announced that it had recently discovered a large oil reserve. The market value of the company's stock immediately went up to $28 per
share. AssetsLiabilitiesStk. EquityRevenuesExpensesNetStmt. of ?IncomeCash Flows???????
What will be an ideal response?
(NA) (NA) (NA) (NA) (NA) (NA) (NA)
The price an investor must pay to purchase a share of stock is the market value. Published financial statements report historical information; in this case, the company's paid-in capital is recorded at the issue price of $14 per share. A change in the market price of the company's common stock has no impact on the elements of the company's financial statements.
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