Land Corporation reported the following: $$\begin{array} { | l | r | }
\hline \text { Common Stock, } \$ 5 \text { par, } 211,000 \text { shares authorized, } 165,000 \text { shares issued } & \$ 825,000 \
\hline \text { Paid in Capital in Excess of Par - Common } & 217,000 \
\hline \text { Retained Earnings } & \$ 207,000 \
\hline \text { Total Stockholders' Equity } & \$ 1,249,000 \
\hline
\end{array}$$ Which of the following is included in the entry to record the corporation's purchase of 40,000 shares of its common stock for $12.00 per share?

Question

Land Corporation reported the following: $$\begin{array} { | l | r | } 
\hline \text { Common Stock, } \$ 5 \text { par, } 211,000 \text { shares authorized, } 165,000 \text { shares issued } & \$ 825,000 \
\hline \text { Paid in Capital in Excess of Par - Common } & 217,000 \
\hline \text { Retained Earnings } & \$ 207,000 \
\hline \text { Total Stockholders' Equity } & \$ 1,249,000 \
\hline
\end{array}$$ Which of the following is included in the entry to record the corporation's purchase of 40,000 shares of its common stock for $12.00 per share?

Quizplus · Accepted Answer

When a corporation purchases its own stock, it is recorded as Treasury Stock-Common being debited for the cost of the shares, which in this case is $480,000. Paid-In Capital from Treasury Stock Transactions, Retained Earnings or Common Stock-$5 Par Value are not affected by the purchase of treasury stock.

Land Corporation Reported the Following Which of the Following Is Included in the Entry to r