Asked by Filip Horá?ek on Jun 01, 2024
Verified
Prepare entries to record the following:
(a)Issued 1,000 shares of $10 par common stock at $59 for cash.(b)Issued 1,400 shares of $10 par common stock in exchange for equipment with a fair market price of $60,000.(c)Purchased 100 shares of treasury stock at $32.(d)Sold the 100 shares of treasury stock purchased in (c) at $42.
Treasury Stock
Shares that were issued and subsequently bought back by the issuing company, reducing the amount of outstanding stock on the open market.
Par Common Stock
The nominal or face value of common stock as stated in the corporate charter.
Fair Market Price
The price at which an asset would trade in a competitive auction setting, reflecting the true value under current market conditions.
- Document transactions involving stock issuance, dividend declarations, and engagements with treasury stock.
- Evaluate the ramifications of stock transactions on cumulative paid-in capital and shareholders' equity.
Verified Answer
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Learning Objectives
- Document transactions involving stock issuance, dividend declarations, and engagements with treasury stock.
- Evaluate the ramifications of stock transactions on cumulative paid-in capital and shareholders' equity.