Question Details

Accounting for treasury stock 





1.	Accounting for treasury stock is done by the
a.	FIFO method.
b.	LIFO method.
c.	cost method.
d.	lower of cost or market method.


2.	Treasury stock is generally accounted for by the
a.	cost method.
b.	market value method.
c.	par value method.
d.	stated value method.


	3.	Treasury Stock is a(n)
a.	contra asset account.
b.	retained earnings account.
c.	asset account.
d.	contra stockholders’ equity account.



4.	Five thousand shares of treasury stock of Marker, Inc., previously acquired at $14 per share, are sold at $20 per share. The entry to record this transaction will include a
a.	credit to Treasury Stock for $100,000.
b.	debit to Paid-In Capital from Treasury Stock for $30,000.
c.	debit to Treasury Stock for $70,000.
d.	credit to Paid-In Capital from Treasury Stock for $30,000.



	5.	Salon Company originally issued 3,000 shares of $10 par value common stock for $90,000 ($30 per share). Salon subsequently purchases 300 shares of treasury stock for $27 per share and resells the 300 shares of treasury stock for $29 per share. In the entry to record the sale of the treasury stock, there will be a
a.	credit to Common Stock for $8,100.
b.	credit to Treasury Stock for $3,000.
c.	debit to Paid-In Capital in Excess of Par of $9,000.
d.	credit to Paid-In Capital from Treasury Stock for $600.







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