Mountip Inc

question 32

Essay

Mountip Inc. was incorporated under provincial legislation with a December 31 year-end. The company has a single class of shares. As at December 31, 2019, it had 150,000 shares issued and outstanding. These shares had a book value of $5,700,000 on the balance sheet. During 2020, Mountip repurchased 5% of the issued shares from one of the minority shareholders at a cost of $48 per share. The company held these in treasury and later found a buyer for half of these shares at $52. The other half were sold at $46 to another investor.
Required:
Record the share transactions using the alternative two-transaction method for treasury stock.

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Definitions:

Commercial Purposes

Pertains to activities or endeavors undertaken with the intention of generating profit or financial gain.

Heisenberg Uncertainty Principle

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Reactivity

involves changes in behavior or results when individuals alter their performance or responses, knowing they are being observed or studied.

Elton Mayo

A psychologist and organizational theorist best known for his work in industrial research and the human relations movement.