On November 6, Coleman Corp. reacquired 1,600 shares of its $5 par value common

Question

On November 6, Coleman Corp. reacquired 1,600 shares of its $5 par value common stock for $29 each. On November 20, Coleman Corp. reissued 1,200 shares for $32 each. Which of the following is correct regarding the effect of the journal entry for the reissued shares?

Liabilities decrease.

Assets decrease.

Expenses increase.

Stockholders’ Equity increases.

On November 6, Coleman Corp. reacquired 1,600 shares of its $5 par value common stock for $29 each. On November 20, Coleman Corp. reissued 1,200 shares for $32 each. Which of the following is correct regarding the effect of the journal entry for the reissued shares?

Explanation / Answer

The journal entry would be

Cash Dr 38400

To shares 6000

To additional paid in capital 32400

It will increase the Stockholders Equity

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