A company issues 10,000 shares of \$0.50 par value stock at \$5 per share. How does this transaction differ from a revenue-generating activity?

• A. Issuing stock increases equity, while revenue increases net income.
• B. Issuing stock is recorded as an expense, while revenue is recorded as an asset.
• C. Issuing stock affects cash flow, while revenue does not.
• D. Issuing stock decreases liabilities, while revenue decreases equity.

Answer: (A)