medium · Investment Banking

If a company spends 800 on CapEx and finances the entire purchase by issuing800 in Common Stock, what is the impact on the 'Total Assets' and 'Total Equity' on the Balance Sheet?

1. Total Assets increase by 800 and Total Liabilities increase by800.
2. Total Assets increase by 800 and Total Equity increases by800.
3. Total Assets decrease by $800 and Total Equity is unchanged.
4. Total Assets are unchanged and Total Equity increases by $800.

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