On January 1, Vermont Corporation Had 40,000 Shares of $10
On January 1, Vermont Corporation had 40,000 shares of $10 par value common stock issued and outstanding. All 40,000 shares had been issued in a prior period at $20.00 per share. On February 1, Vermont purchased 3,750 shares of treasury stock for $24 per share and later sold the treasury shares for $21 per share on March 1.
The journal entry to record the purchase of the treasury shares on February 1 would include a
A) credit to Treasury Stock for $90,000
B) debit to Treasury Stock for $90,000
C) debit to a loss account for $112,500
D) credit to a gain account for $112,500
Which statement below is not a reason for a corporation to buy back its own stock?
A) resale to employees
B) bonus to employees
C) for supporting the market price of the stock
D) to increase the shares outstanding
How is treasury stock shown on the balance sheet?
A) as an asset
B) as a decrease in stockholders' equity
C) as an increase in stockholders' equity
D) treasury stock is not shown on the balance sheet
The excess of sales price of treasury stock over its cost should be credited to
A) Treasury Stock Receivable
B) Premium on Capital Stock
C) Paid-In Capital from Sale of Treasury Stock
D) Income from Sale of Treasury Stock