A Company Purchases 600 Shares of Its $100 Par Value

question 15

Multiple Choice

A company purchases 600 shares of its $100 par value common stock at $110 per share.It then reissues 100 shares at $114 per share.The entry upon reissue of the stock would be:

• A)
• \(\begin{array} { l r r }
• \text { Cash } & 11,400 & \\
• \text { Treasury Stock-Common } & & 11,000 \\
• \text { Paid-in Capital, Treasury Stock } && 400
• \end{array}\)
• B)
• \(\begin{array}{ll}
• \text { Cash } & 11,400 \\
• \text { Treasury Stock-Common } &&11,400
• \end{array}\)
• C)
• \(\begin{array}{l}
• \text { Cash }&11,400\\
• \text { Treasury Stock-Common } && 11,000 \\
• \text { Gain on Sale of Treasury Stock } && 400
• \end{array}\)
• D)
• \(\begin{array}{l}
• \text { Cash }&11,400\\
• \text { Treasury Stock-Common } && 10,000 \\
• \text { Retained Earnings } && 1,400
• \end{array}\)

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Definitions:

Calcium Carbonate

A chemical compound found in rocks, shells, and marine organisms, commonly used as a building material and in manufacturing.

Limestone

A sedimentary rock composed primarily of calcite or dolomite, often formed from the skeletal fragments of marine organisms.

Stalagmites

Mineral formations that rise from the floor of a cave due to the accumulation of material deposited by dripping water from the ceiling.

Karst Topography

A landscape formed from the dissolution of soluble rocks such as limestone, dolomite, and gypsum, characterized by underground drainage systems with sinkholes, caves, and disappearing streams.