Moony Corporation had 20,000 shares of $4 par-value common stock outstanding on January 1, 2012. On January 10, 2012, the firm purchased 2,000 of its outstanding shares for $18 per share. On July 22, 2012, it reissued 1,000 shares at $22 per share. Given this information, the entry to record the reissuance of the stock on July 22 would include a credit to

Question

Quizplus · Accepted Answer

The reissuance of treasury stock at a price higher than the purchase price results in a credit to "Paid-In Capital, Treasury Stock" for the difference between the reissue price and the purchase price. Here, the difference is $4 per share for 1,000 shares, totaling $4,000.

Moony Corporation Had 20,000 Shares of $4 Par-Value Common Stock