Question

Q 11.7: Foley Manufacturing Corporation purchased 3,000 shares of its own previously issued $10 par common stock for $69,000. As a result of this event,

Answer 1

Debit Credit

Treasury Stock 69,000

Cash 69,000

Step-by-step explanation:

In this transaction the corporation is paying cash to buy common stock so the amount paid for the stock will be credited as cash. So we will credit cash by 69,000 as that is the amount paid by the corporation to buy the stock. Secondly whenever a company buy's it's own stock the amount is debited as treasury stock so we will debit treasury stock by 69,000.