ABC, Inc. Shareholders’ Equity Paid-in capital: Common stock, 500,000 shares at
ID: 2598238 • Letter: A
Question
ABC, Inc.
Shareholders’ Equity
Paid-in capital:
Common stock, 500,000 shares at $1.00 par
$500,000
Paid-in capital in excess of par
600,000
Less: Treasury stock, 100,000 shares at cost
(100,000)
Total shareholders’ equity
$1,000,000
What are the number of shares issued and outstanding (this is not asking about the number of shares issued)?
ABC, Inc.
Shareholders’ Equity
Paid-in capital:
Common stock, 500,000 shares at $1.00 par
$500,000
Paid-in capital in excess of par
600,000
Less: Treasury stock, 100,000 shares at cost
(100,000)
Total shareholders’ equity
$1,000,000
Explanation / Answer
1) Answer (D) $400,000
Explanation : Given that the number shares issued are 500,000 in the balance sheet and out of the 500,000 shares company was purchased it's own shares for the purpose of reissue which needs to be reduced from the number of shares outstanding earlier that is 500,000. And the shares outstanding currently are 400,000. *(500,000-100,000)
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