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Linda Masson has decided to incorporate her small jewellery business. The documents of incorporation state...

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Accounting

Linda Masson has decided to incorporate her small jewellery business. The documents of incorporation state that she has been issued 5,000 shares at a cost of $5 each. How will this transaction affect the companys accounting equation?

Question 30 options:

Cash will increase by $25,000 and Common Shares will increase by $25,000.

Cash will decrease by $25,000 and Common Shares will increase by $25,000.

Common Shares will increase by $25,000 and Retained Earnings will decrease by $25,000.

Shareholders' Equity will increase by $25,000 and Cash will decrease by $25,000.

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