Ross Corporation reported the following equity section on its current balance sheet.
$$\begin{array} { | l | r | }
\hline \begin{array} { l }
\text { Common stock, \$5 par, 140,000 shares } \
\text { authorized, 50,000 shares issued }
\end{array} & \$ 250,000 \
\hline \text { Paid in capital in excess of par - common } & 200,000 \
\hline \text { Retained earnings } & \underline { 207,000 } \
\hline \text { Total stockholders' equity } & \$ \underline { 657,000 } \
\hline
\end{array}$$ The corporation has acquired treasury stock for $10 per share. Which of the following would be included in the entry to record the corporation's reissue of 8,000 shares of its common stock for $13 per share?

Question

Ross Corporation reported the following equity section on its current balance sheet.
$$\begin{array} { | l | r | } 
\hline \begin{array} { l } 
\text { Common stock, \$5 par, 140,000 shares } \
\text { authorized, 50,000 shares issued }
\end{array} & \$ 250,000 \
\hline \text { Paid in capital in excess of par - common } & 200,000 \
\hline \text { Retained earnings } & \underline { 207,000 } \
\hline \text { Total stockholders' equity } & \$ \underline { 657,000 } \
\hline
\end{array}$$ The corporation has acquired treasury stock for $10 per share. Which of the following would be included in the entry to record the corporation's reissue of 8,000 shares of its common stock for $13 per share?

Quizplus · Accepted Answer

When reissuing treasury stock above its cost, the excess is credited to Paid-in Capital from Treasury Stock Transactions. Here, the shares are reissued at $13 per share, which is $3 above the cost of $10 per share. The calculation for the credit to Paid-in Capital from Treasury Stock Transactions is 8,000 shares * $3 = $24,000.

Ross Corporation Reported the Following Equity Section on Its Current