Blowing Rock Manufacturing Corporation purchased 15000 shares of its own previously issued $1 par common stock for $150000.Use the following tabular analysis to record this event:

Question

Quizplus · Accepted Answer

When a company purchases its own stock, the cash account is decreased and the Treasury Stock account is increased. This transaction has no effect on Common Stock or Retained Earnings accounts until the shares are either retired (cancelled) or reissued to the public. Therefore, choice B is the correct answer.

Blowing Rock Manufacturing Corporation Purchased 15000 Shares of Its Own