D) The balance in common stock cannot be determined from the information given 7
ID: 2584818 • Letter: D
Question
D) The balance in common stock cannot be determined from the information given 7. A corporation originally issued $8 par value stock for $9 per share. It reacquired the stock $10 per share. Which of the following would be included in the entry to record the reissue of shares for $11 per share? A) Paid-in capital from treasury stock transactions is credited for $220 B) Treasury stock is credited for $200 C) Treasury stock is credited for $220 D) Paid-in capital from treasury stock transactions is credited for $200 Q8-9)The following information is from the books of Eastern Corporation. Net income Preferred dividends Interest expense $170,000 24,000 17,500 Beginning of the year amounts: Total assets Total liabilities Total common stockholders' equity 900,000 375,000 395,000 End of the year amounts: Total assets Total liabilities Total common stockholders' equity 930,000 405,000 435,000 8. Which of the following is the return on assets for Eastern Corporation? A) 20.5% B) 17.5% C) 19.2% D) 168%Explanation / Answer
7.
Answer : B. Treasury stock is credited for $200
20 shares * $10 = $200.
8.
Answer : A. 20.5%.
Return on assets = ($170000 + $17500) / ($900000 + $930000)/2
= $187500 / $915000
= 20.49%.
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