Question
Biscayne Bay Water Inc. bottles and distributes spring water. On May 14 of the current year, Biscayne Bay Water Inc. reacquired 23,500 shares of itscommon
Biscayne Bay Water Inc. bottles and distributes spring water. On May 14 of the current year, Biscayne Bay Water Inc. reacquired 23,500 shares of itscommon stockat $75 per share. On September 6, Biscayne Bay Water Inc. sold 14,000 of the reacquired shares at $81 per share. The remaining 9,500 shares were sold at $72 per share on November 30. Required:
A. | Journalize the transactions of May 14, September 6, and November 30. Refer to the Chart of Accounts for exact wording of account titles. |
B. | What is the balance inPaid-In Capitalfrom Sale of Treasury Stock on December 31 of the current year? |
C. | Where will the balance in Paid-In Capital from Sale of Treasury Stock be reported on the balance sheet? |
D. | For what reasons might Biscayne Bay Water Inc. have purchased the treasury stock? |
Chart of Accounts
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General Ledger | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Journal A. Journalize the transactions of May 14, September 6, and November 30. Refer to the Chart of Accounts for exact wording of account titles. PAGE 10 JOURNAL
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Final Questions B. What is the balance inPaid-In Capitalfrom Sale of Treasury Stock on December 31 of the current year?
C. Where will the balance in Paid-In Capital from Sale of Treasury Stock be reported on the balance sheet?
___________________________________
D. For what reasons might Biscayne Bay Water Inc. have purchased the treasury stock?Check all that apply.
_____For reissuance to employees as a bonus according to stock purchase agreements. _____To support the market price of the stock _____The company wishes to increase the par value of its stock. _____To provide shares for resale to employees. The company wishes to receive more of its own dividends.
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