Buffalo Butter Co

question 166

Multiple Choice

Buffalo Butter Co.had 40,000 shares of $4 par value common stock outstanding on January 1.On January 20,the company purchased 4,000 of its stock for $16 per share.On July 3,the company reissued 2,000 of the shares at $20 per share.Buffalo Butter uses the cost method to account for its treasury stock. What journal entry will record the purchase of the stock on January 20?

• A)Debit Treasury Stock for $16,000,debit Additional Paid-in Capital for $48,000,and credit Cash for $64,000.
• B)Debit Treasury Stock and credit Cash for $64,000.
• C)Debit Treasury Stock for $16,000,debit Common Stock for $48,000,and credit Cash for $64,000.
• D)Debit Common Stock and credit Cash for $64,000.

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Definitions:

Trade

The exchange of goods, services, or both between two or more parties, often for the purpose of economic gain.

Tikal Project

An archaeological undertaking focused on the study and excavation of Tikal, an ancient Mayan city in Guatemala.

Archaeologists

Experts dedicated to the study and interpretation of ancient societies through material remains, aiming to reconstruct and understand past human behaviors.

Excavation

The process of systematically removing earth to find buried remains, artifacts, or structures, typically used in archaeology.