Elroy Corporation repurchased 4,000 shares of its own stock for $50 per share. The stock has a par of $5 per share. A month later Elroy resold 1,000 shares of the treasury stock for $58 per share. What is the balance of the Treasury Stock account after these transactions are recognized?

Elroy Corporation repurchased 4,000 shares of its own stock for $50 per share. The stock has a par of $5 per share. A month later Elroy resold 1,000 shares of the treasury stock for $58 per share. What is the balance of the Treasury Stock account after these transactions are recognized?

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter10: Stockholder's Equity

Section: Chapter Questions

Problem 6MCQ: Ames Corporation repurchases 10,000 shares of its common stock for $12 per share. The shares were...

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Question

Elroy Corporation repurchased 4,000 shares of its own stock for $50 per share. The stock has a par of $5 per share. A month later Elroy resold 1,000 shares of the treasury stock for $58 per share.

What is the balance of the Treasury Stock account after these transactions are recognized?

Definition Definition Stock repurchased from the stockholders by the company that once issued it. The repurchase of the stock reduces the stockholder's equity balance on the balance sheet. Treasury stocks are an important constituent of stockholder's equity but do not carry any voting rights.

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