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Fixit Corporation issued 20,000 shares of $20 par value common stock at its current market price of $32. How does this event affect total stockholders’ equity?a. It increases by $640,000.b. It is unaffected.c. It increases by $240,000.d. It increases by $400,000.

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Answer:

It increases by $640,000.

Explanation:

Calculation for How the event affect total stockholders’ equity

Based on the information given the event

will affect total stockholders’ equity by increasing the assets and stockholders’ equity by the amount of $640,000 which is calculated as:

Increase in assets and stockholders’ equity =20,000 shares*$32 per share

Increase in assets and stockholders’ equity =$640,000

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