Immediately Before Cavecreek Corporation Purchased 4 A Assume All of the Treasury Stock Was Sold for $4,800

question 101

Essay

Immediately before Cavecreek Corporation purchased 4
$\begin{array}{lr}\text { Common stock, \$2 par } & \$ 80,000 \\\text { Additional paid-in capital - common } & 50,000 \\\text { Additional paid-in capital-treasury stock } & 600 \\\text { Retained earnings } & 25,400 \\\text { Treasury stock } & \underline{(2,000)} \\\text { Total shareholders' equity } & \underline{\$ 154,000}\end{array}$

A. Assume all of the treasury stock was sold for $4,800. Calculate the following amounts:
1. Additional paid-in capital—treasury stock
2. Retained earnings
3. Total shareholders' equity
B. Assume all of the treasury stock was sold for $850. Calculate the following amounts:
1. Additional paid-in capital—treasury stock
2. Retained earnings
3. Total shareholders' equity

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Definitions:

Minimally Required

The least amount that is necessary or allowed, especially in the context of financial or regulatory requirements.

Cash Inflows

Money or the amount of money received by a business from its operational, financing, and investing activities.

Mutually Exclusive

Situations or options that cannot occur or be chosen at the same time.