If $1,108,000 of 9% bonds are issued at 102 1/2, what is the amount of cash rece

Question

If $1,108,000 of 9% bonds are issued at 102 1/2, what is the amount of cash received from the sale?

Select the correct answer.

Treasury stock that had been purchased for $3,658 last month was reissued this month for $5,152. What would the journal entry to record the reissuance include?

Select the correct answer.

$1,108,000 $1,135,700 $1,207,720 $831,000

Treasury stock that had been purchased for $3,658 last month was reissued this month for $5,152. What would the journal entry to record the reissuance include?

Select the correct answer.

Credit to Excess of Par/Common for $1,494 Treasury Stock for $3,658 Credit to Treasury Stock for $1,494 Debit to Treasury Stock for $3,658

Explanation / Answer

1.

Cash received on sale of bonds should be ( No. of bonds x issue price )

so cash recieved = 1108000 x 102.5% = 1135700.

2.

Cash Dr. 5,152

To Treasury stock Cr.3,658

To Excess of Par/Common Stock – treasury stock Cr.1,494

So answer should be Credit to Excess of Par/Common for $1,494.

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