Use the following informa tion to answer questions 30 and 31 JC Corporation had

Question

Use the following informa tion to answer questions 30 and 31 JC Corporation had 20,000 shares of $3 par value common stock outstanding on January 1", On January 20h purchased 2,000 of the outstanding shares for $16 per share. On July 3d, the company re at $20 per share. JC uses the cost method to account for its treasury stock 30. What is the journal entry to record the purchase of the stock on January 20 Treasury Stock Additional Paid-in Capital 26,00032000 Treasury Stock 32,000 Cash 32,000 C. Treasury Stock Common Stock Treasury Stock 32.000 32.000 Common Stock Common Stock 32,000 Cash 32,000 31. What is the journal entry to record the reissuance on July 3 A. Cash 20,000 Treasury Stock Gain on Reissuance 3,000 17,000 B. 20,000 Treasury Stock Additional Paid-In Capital 16,000 4,000 C. 20,000 Treasury Stock Gain on Reissuance 16,000 4,000 D. 20,000 Common Stock Additional Paid-In Capital 3,000 17,000 E. 20,000 20,000 Treasury Stock

Explanation / Answer

30 Treasury stock 32000 =2000*16         Cash 32000 31 Cash 20000      Treasury stock 16000       Additional paid in capital 4000

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