Gannon Company sold 3,000 shares of treasury stock at $17 per share on August 9,

Question

Gannon Company sold 3,000 shares of treasury stock at $17 per share on August 9, 2010. Gannon acquired these shares of its own common stock at $20 per share on February 5, 2010. On August 9, 2010 (before any entry is made), the Paid-in Capital from Treasury Stock account has a balance of $5,000. The cost method is used to record treasury stock transactions. What account(s) should Gannon debit to record the sale of 3,000 shares?

A.Treasury Stock for $60,000.

B.Paid-in Capital from Treasury Stock for $9,000

C.Paid-in Capital from Treasury Stock for $9,000 and Retained Earnings for $4,000.

D. Paid-in Capital from Treasury Stock for $5,000 and Retained Earnings for $4,000.

Explanation / Answer

Cash 51000 51000 Paid-in Capital from Treasury Stock 5000 Retained Earnings 4000        Treasury stock 60000 =3000*20 Option D is correct

Related Questions

Navigate

• Browse (All)
• Browse G
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.