What is treasury stock? Why do corporations purchase and issue treasury stock? H
ID: 2403495 • Letter: W
Question
What is treasury stock? Why do corporations purchase and issue treasury stock?
How do you record the purchase of treasury stock? How does treasury stock affect the equity section of the balance sheet?
How would you record the reissuance of treasury stock if the proceeds obtained are:
At cost of the treasury stock?
Less than the cost of the treasury stock?
More than the cost of the treasury stock?
What is the main difference between notes payable and bonds payable?
What is the main difference between a bond and a share of stock?
What does it mean to issue bonds at
Par?
Discount?
Premium?
What is the contract rate and the market rate for bonds?
How do you compute total bond interest expense when a bond is sold at a discount? Explain your answer.
How do you compute bond interest expense when a bond is sold at a premium? Explain your answer.
What accounts are affected when recording the issue date of a discount bond? What accounts are affected when recording interest and amortization? Which accounts are credited and which accounts are debited when creating journal entries?
What accounts are affected when recording the issue date of a premium bond? What accounts are affected when recording interest and amortization? Which accounts are credited and which accounts are debited when creating journal entries?
What accounts are affected when a bond matures? Which accounts are credited and which accounts are debited when creating journal entries?
**PLEASE ANSWER ALL OR DO NOT ANSWER**
Explanation / Answer
Giving below answer for treasury stock. However, as chegg policy, multiple parts to be posted in seperate questions:
Treasury Stock Treasury Stock is outstanding stock repurchased from stockholders by the issuing company. Why do corporations purchase and issue treasury stock? If the stock is trading cheap, management would want to buy Fewer outstanding shares increase the value per share, so a company might buyback shares to benefit its shareholders. How do you record the purchase of treasury stock? Treasury Stock Debit Cash Account Credit How does treasury stock affect the equity section of the balance sheet? This will be reduced from Common Stock, and will be shown seperately as Treasury Stock How would you record the reissuance of treasury stock if the proceeds obtained are: At cost of the treasury stock?: Cash Account Debit Treasury Stock Credit Less than the cost of the treasury stock?: Cash Account Debit Paid in Capital-Treasury Stock Debit Treasury Stock Credit More than the cost of the treasury stock? Cash Account Debit Paid in Capital-Treasury Stock Credit Treasury Stock CreditRelated Questions
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