1. A company purchases 1,000 shares of its $10 par value common stock when the market price per share is $25. The entry to record the treasury stock purchase is:
| a. Debit Treasury Stock, Common, $25,000; credit Cash $25,000. | | |
| | b. Debit Treasury Stock, Common, $10,000; debit Additional Paid-in Capital, Common, $15,000; credit Cash $25,000. | | |
| | c. Debit Common Stock, $10,000; debit Additional Paid-in Capital, Common, $15,000; credit Cash $25,000. | | |
| | d. Debit Cash $25,000; credit Treasury Stock, Common, $25,000. | | |
2. Tri-City Corporation reports on its balance sheet 1,000 shares of $100 par value, 5%, cumulative, preferred stock; 6,000 shares issued, 5,000 outstanding, of $10 par value common stock; Additional Paid-in Capital, Common of $40,000; 1,000 shares of Treasury Stock, Common at $10,000; and Retained Earnings of $80,000. The preferred shares are callable at $110, and no dividends are in arrears.
The book value per share of Tri-City's common stock is
3.Johanna Corporation issues 1,000 shares of $20 par value stock for $50,000. The entry to record the stock issue is:
| a. Debit Cash, $50,000; Credit Common Stock $50,000. | | |
| | b. Debit Common Stock, $20,000; debit Additional Paid-in Capital, Common, $30,000; credit Cash, $50,000. | | |
| | c. Debit Cash, $50,000; credit Common Stock, $20,000; credit Additional Paid-in Capital, Common, $30,000. | | |
| | d. Debit Common Stock, $50,000; credit Cash, $50,000. | | |
