Question

The corporate charter of Llama Co. authorized the issuance of 10 million, $1 par common shares. During 2016, its first year of operations, Llama had the following transactions:January 1 sold 8 million shares at $15 per shareJune 3 purchased 2 million shares of treasury stock at $18 per shareDecember 28 sold the 2 million shares of treasury stock at $20 per shareWhat amount should Llama report as additional paid-in capital in its December 31, 2016, balance sheet?$122 million$116 million$112 million$74 million

Answer 1

Answer:

$116 million

Explanation:

January 1                  8,000,000*(15-1)     =$112,000,000

December 28  Treasury stock sold    2,000,000*(20-18)=$4,000,000

Paid in Capital At December 31,2016                           $116,000,000