Assume that the Stockholders' Equity section of Cherokee Company's balance sheet on December 31, 2015,
appears as follows:

1. If on February 1, 2016, Cherokee buys 120 of its shares as treasury stock at $30 per share, what are the accounting equation effects on Cherokee's books?
2. How with the Stockholders' Equity section of Cherokee's balance sheet appear on February 1, 2016, after the
purchase of the treasury stock?

Question

Assume that the Stockholders' Equity section of Cherokee Company's balance sheet on December 31, 2015,
appears as follows:
  
1. If on February 1, 2016, Cherokee buys 120 of its shares as treasury stock at $30 per share, what are the accounting equation effects on Cherokee's books?
2. How with the Stockholders' Equity section of Cherokee's balance sheet appear on February 1, 2016, after the
purchase of the treasury stock?

Quizplus · Accepted Answer

The Answer of Assume that the Stockholders' Equity section of Cherokee Company's balance sheet on December 31, 2015,
appears as follows:
  
1. If on February 1, 2016, Cherokee buys 120 of its shares as treasury stock at $30 per share, what are the accounting equation effects on Cherokee's books?
2. How with the Stockholders' Equity section of Cherokee's balance sheet appear on February 1, 2016, after the
purchase of the treasury stock?

Assume That the Stockholders' Equity Section of Cherokee Company's Balance