Ladder Distributors The stockholders\' equity section of the December 31, 2014,
ID: 2477722 • Letter: L
Question
Ladder Distributors
The stockholders' equity section of the December 31, 2014, balance sheet is provided below:
Common Stock, $30 par, 20,000 shares issued and outstanding $600,000
Paid in Capital in Excess of Par--Common Stock $240,000
Retained Earnings $700,000
Total Stockholders' Equity $1,540,000
On March 1, 2015, the company reacquired 4,000 shares of its common stock for $50 per share.
Refer to Ladder Distributors. Suppose the compnay reissed 1,000 shares of its treasury stock on June 1, 2015, for $39 each. Which of the following is TRUE regarding the entry required to record this transaction?
A. A debit to treasury stock is requied for $50,000
B. A credit to treasury stock is required for $39,000
C. A debit to retained earnings is required for $11,000
D. A debit to paid-in capital from treasury stock transactions is requires for $3,000
Explanation / Answer
ENtry :
Cash debit 39000 [39*1000]
Retained earning debit 11000 [ (50-39) *1000]
Treasury stock credit 50000
correct optin is " C"
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.