13) When O'Rourke Corporation sells treasury stock for more than the original cost:
A) stockholders' equity increases.
B) paid-in capital increases.
C) retained earnings may increase.
D) retained earnings may decrease.
14) Barkley's Resort had 2,000 shares of $20 par value common stock outstanding. On June 1, Barkley's purchased 200 shares of treasury stock for $21 per share and later reissued them for $22 per share. What amount of profit from the re-issuance will be reported on the income statement?
A) $400
B) $200
C) $100
D) $0
15) Treasury stock should usually be recorded at:
A) par or stated value.
B) cost.
C) original issue price.
D) net realizable value.
16) If treasury stock is re-issued at a price less than its cost, the debit entry could include:
A) paid-in capital in excess of par, treasury.
B) retained earnings.
C) treasury stock.
D) both A and B.
17) A corporation purchased 35 shares of treasury stock for $40. The entry to record the transaction would include a:
A) debit to Cash for $1400.
B) credit to Treasury Stock for $1400.
C) debit to Treasury Stock for $1400.
D) None of these answers are correct.
18) A corporation sold 20 shares of $20 par value treasury stock for $40 per share. The treasury stock cost $30 per share to acquire. The entry to record the transaction would include a:
A) credit to Paid-in Capital-Treasury Stock for $600.
B) debit to Treasury Stock for $800.
C) debit to Paid-in Capital Treasury Stock for $200.
D) debit to Common Stock for $400.
19) If treasury stock is sold for less than cost, the entry to record the transaction would include a:
A) debit to Treasury Stock.
B) credit to Treasury Stock.
C) debit to Common Stock.
D) None of these answers are correct.
20) Curtis Corporation's balance sheet included the following:
Common Stock, $5 par value, 5,000 shares issued
and outstanding$25,000
Retained Earnings20,000
Total Stockholders' Equity$45,000
Prepare journal entries for the following transactions:
May 3Issued 500 shares at $6 per share.
9Reacquired 100 shares at $4 per share.
15Reissued 50 of the Treasury shares at $7 per share.
17Reissued 10 of the Treasury shares at $3 per share.
