A corporation does not make a journal entry when:
A)a shareholder exchanges the shares for cash with a different investor.
B)shares are repurchased by the corporation at a price greater than their issue price.
C)shares are repurchased by the corporation at a price less than their issue price.
D)the corporation sells its treasury stock for cash to an investor.

Question

Quizplus · Accepted Answer

When a company issues stock to the public,repurchases its stock,or reissues the purchased shares,the transaction is between the issuing corporation and an investor.However,when an investor exchanges shares for cash provided by other investors,the corporation is not directly affected.These transactions involve only the owners of the company and not the corporation itself.

A Corporation Does Not Make a Journal Entry When