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ruslelena [56]
3 years ago
11

GE buys back 300,000 shares of its stock from investors at $45 a share. Two years later it reissues this stock for $65 a share.

The stock reissue would be recorded with a debit to Cash for:__________
a) $19.5 million, a credit to Treasury Stock for $13.5 million, and a credit to Additional Paid-in Capital for $6 million.
b) $13.5 million, a debit to Additional Paid-in Capital for $6 million, a credit to Treasury Stock for $13.5 million, and a credit to Stockholders' Equity for $6 million.
c) $19.5 million, a credit to Treasury Stock for $13.5 million, and a credit to Gain on Sale of Treasury Stock for $6 million.
d) $19.5 million and a credit to Treasury Stock for $19.5 million.
Business
1 answer:
neonofarm [45]3 years ago
4 0

Answer:

The correct answer is Option A.

Explanation:

Treasury stocks are simply company's own stock repurchased by the company. When this happens, there is cash outflow in order to increase the stock.

When GE bought back 300,000 shares of its stock from investors at $45 a share, the value of the treasury stock was 300,000 shares x $45 = $13.5m. However, the stock was reissued for $65 a share, translating to 300,000 shares x $65 = $19.5m cash receipt.

The appropriate entries to raise would be a debit to cash for $19.5 million, a credit to Treasury Stock for $13.5 million, and a credit to Additional Paid-in Capital for $6 million.

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Vsevolod [243]

Answer:

Results are below.

Explanation:

<u>The absorption costing </u>method includes all costs related to production, both fixed and variable. The unit product cost is calculated using direct material, direct labor, and total unitary manufacturing overhead.

<u>The variable costing method</u> incorporates all variable production costs (direct material, direct labor, and variable overhead).

<u>Variable costing income statement:</u>

Total unitary variable production cost= (24 + 16 + 2 + 3)= $45

Sales= 73*51,000= 3,723,000

Total variable cost= 51,000*45= (2,295,000)

Contribution margin= 1,428,000

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Net operating income= (28,000)

<u>Absorption costing income statement:</u>

Unitary production cost= (24 + 16 + 2) + (784,000/56,000)

Unitary production cost= $56

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<u>The difference between both methods is the fixed manufacturing overhead allocated in ending inventory.</u>

6 0
3 years ago
A local art gallery keeps information on its customers regarding their preferences forcertain artists as well as the style of ar
notsponge [240]

Answer:

A - Value co - creation

Explanation:

Value co - creation is a strategy that promotes and encourages active involvement from the customer to create on-demand and made-to-order products. with this strategy,  consumers get exactly what they want and are involved in making it happen. So the Art gallery using such information is clearly using a value - co creation strategy to build loyalty among its customer.

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3 years ago
Computing Income Taxes
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Answer:

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Explanation:

To calculate tax liability we first have to find net profit. Detail calculation is given below.

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5 0
3 years ago
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taurus [48]

Answer:

C

Explanation:

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Correct option: C

5 0
3 years ago
Read 2 more answers
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Inessa [10]

Answer:

Explanation:

I'm pretty sure that gross profit is simply just sales-Cost of goods sold

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5 0
3 years ago
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