FULL SCREEN PRITER VERSTONANEXT Question 4 Marigold Corporation sold 320 shares
ID: 2438053 • Letter: F
Question
FULL SCREEN PRITER VERSTONANEXT Question 4 Marigold Corporation sold 320 shares of treasury stock for $40 per share. The cost for the shares was $30. The entry to record the sale vwill include a O credit to Gain on Sale of Treasury Stock for $960o. O credit to Paid-in Capital from Treasury Stock for $3200. O debit to Paid-in Capital in Excess of Par for $3200. O credit to Treasury Stock for $12800 Click if you would like to Show Work for this question: Open Show Work By accessing this Question Assistance, you will learn while you earn points based on the Point Potential Policy set by your instructor. Question Attempts: 0 of 5 used SAVE FOR LATER Earn Maximum Points available only if you answer this question correctly in four attempts or less. 949 AMExplanation / Answer
Answer:
Credit to Paid -in-Capital from treasury stock for $3,200
Explaination:
When the corporation purchase the treasury stock, the journal entry would be as follows:
This treasury stock will be shown under shareholders equity section of balance sheet as a negative balance instead of showing this account as an asset on the asset side of balance sheet.
And when the corporation sell this stock, the journal entry is as follows:
The gain or loss on account of sale of treasury stock shall not be taken to income statement and instead, will be taken to balance sheeet by debiting paid in capital in case of loss or crediting paid in capital in case of gain.
Date Accounts Titles and Explaination Debit Credit Treasury stock a/c $9,600 Cash a/c [320 shares x $30] $9,600 [Being Treasury stock purchased]Related Questions
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