Question

On 6/30, Office Depot purchased 17,000 shares of treasury stock at $9 per share. On 11/1, Office Depot resold half of the treasury shares for $4 per share. On 11/1, what should be recorded as a debit to the Additional Paid-in-capital account?

Answer 1

$42,500

Step-by-step explanation:

Number of shares sold = 17,000 shares * 1/2 = 8,500

Cost per share = $9

Selling price per share = $4

Date General Journal Debit Credit

11/1 Cash $34,000

(8,500 * $4)

Additional paid in capital $42,500

[8,500*($9 - $4)]

Treasury stock $76,500

(To record sale of treasury stock)