1. What impact will the following activity have on total assets, total liabilities, and total equity?

XYZ Company Issued 7,000 shares of common stock to new investors.

*Total assets increase; total liabilities do not change; total equity decreases

*Total assets decrease; total liabilities do not change; total equity increases

*Total assets decrease; total liabilities do not change; total equity decreases

*Total assets increase; total liabilities do not change; total equity increases

2. What impact will the following activity have on total assets, total liabilities, and total equity?

XYZ Company repurchased their own shares on the open market.

*Total assets decrease; total liabilities do not change; total equity increases

*Total assets decrease; total liabilities do not change; total equity decreases

*Total assets increase; total liabilities do not change; total equity increases

*Total assets increase; total liabilities do not change; total equity decreases