The following data has been collected about Keller Company's stockholders' equity accounts:
-Assuming the treasury shares were all purchased at the same price,the cost per share of the treasury stock is:
A)$1.15.
B)$1.28.
C)$11.50.
D)$10.50.
E)$10.00.

Question

The following data has been collected about Keller Company's stockholders' equity accounts: 
-Assuming the treasury shares were all purchased at the same price,the cost per share of the treasury stock is:
A)$1.15. 
B)$1.28. 
C)$11.50. 
D)$10.50. 
E)$10.00.

Quizplus · Accepted Answer

The cost per share of the treasury stock is calculated by dividing the total cost of the treasury stock by the number of shares purchased. The total cost of the treasury stock is calculated by subtracting the ending balance of the treasury stock from the beginning balance and multiplying by the par value per share. In this case, the total cost of the treasury stock is ($300,000 - $0) x $1 = $300,000. The number of shares purchased is the beginning balance of treasury stock (25,000 shares) minus the ending balance of treasury stock (15,000 shares) which equals 10,000 shares. Therefore, the cost per share of the treasury stock is $300,000 ÷ 10,000 shares = $11.50.

The Following Data Has Been Collected About Keller Company's Stockholders