Question

If biscuit corporation has 250,000 shares of common stock authorized, 150,000 shares of common stock issued, and holds 40,000 of common stock as treasury stock, the total number of outstanding shares of biscuit corporation amounts to:

Answer 1

We are asked to solve for the total of outstanding shares that the biscuit corporation has given that initial common stock is 25,000 shares. When 150,000 shares of common stock were issued, the new remaining balance can be computed as below:
New Balance common stock = old balance - issued shares
New Balance common stock = 250,000 - 150,000
New Balance common stock = 100,000
When 40,000 shares were on hold in the common stock, we have a new balance as shown below:
New balance stock = 100,000 + 40,000
New balance stock = 140,000 shares
The answer is 140,000 shares of common stock.