Investments in stocks that are expected to be held for the long term are listed in the Stockholders' equity section of the balance sheet.

On July 6 Crevasse Corporation issued 2000 shares of its $1.50 par common stock. The market price of the stock on that date was $18 per share. Journalize the issuance of the stock.

Stage Technologies is a London-based company that supplies engineering solutions for the entertainment industry. It has helped the boy-band Westlife make a flying entrance onto stage and provided stage-rigging packages for the Princess cruise line. The company was established in 1994 after a couple of production designers decided that the automation of theater productions could be done more safely and more efficiently by using modular production rather than the old "build-as-needed" formula. The company installs wenches, stage lifts, and other equipment commonly used in stage productions. The equipment is designed so it can be operated from a single console without heavy lifting. Both opera companies and theaters see the benefit of such a system, but many are reluctant to buy because of perceived costs. Joseph Harris is the company's best salesperson. Harris is making a sales call on the manager of a theater that is planning to perform three plays this season that include complicated lifting, flying, and a working trapdoor. The manager is aware of the time, labor, and monetary costs involved in staging these productions and wishes there was an easier way to produce the three plays.
The theater manager is most likely at the:

A) unconscious level and will be a difficult sell.
B) preconscious level and will require a lengthy sales presentation.
C) routine decision level and anxious about the purchase.
D) conscious level and easy to sell to.
E) routine decision level with few objections.

The full disclosure principle says that if a change is made to the inventory valuation method, the company should:

A) disclose the change.
B) show the effects of the change on profit and inventory valuation.
C) show justification for the change in a footnote on the financial reports.
D) All of these answers are correct.