HiTech Industries reacquired 10,000 shares of its $26-par common stock for $70/share. The debit to Treasury Stock will be:

Question

Quizplus · Accepted Answer

The debit to Treasury Stock is calculated based on the cost method, which involves recording the treasury stock at the price paid to reacquire the shares. In this case, HiTech Industries reacquired 10,000 shares at $70/share, so the debit to Treasury Stock is 10,000 shares * $70/share = $700,000.

HiTech Industries Reacquired 10,000 Shares of Its $26-Par Common Stock