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Valor Company issued 5,000 shares of $1 par common stock for $30 per share, providing...

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Question

Accounting

Valor Company issued 5,000 shares of $1 par common stock for $30 per share, providing the company with

$150,000 in cash. What effect, in addition to the increase in cash, does this transaction have on the accounting equation for Valor?

Common Stock increases $150,000.

Common Stock increases $5,000; Additional Paid-in Capital - Common increases $145,000.

Common Stock increases $5,000; Retained Earnings increases $145,000.

Common Stock increases $5,000; Gain on Sale of Common Stock increases $145,000.

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