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30 May, 07:00

On February 22, Brett Corporation acquired 250 shares of its $3 par value common stock for $26 each. On March 15, the company resold 66 shares for $29 each. What is true of the entry for reselling the shares

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  1. 30 May, 09:56
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    Answer: Credit Additional Paid in Capital $198

    Explanation:

    Brett Corporation reissued the Treasury Stock at $29 which was $3 higher than the amount they had repurchased it for.

    When stock is sold for a price higher or lower than they are worth, the balance goes to the Additional Paid-in Capital account. If it is sold higher, the balance is Credited to the Additional Paid-in Capital account and if it is sold for lower than it is worth, it is debited.

    The Balance here is,

    = $3 * 66 resold shares

    = $198

    This $198 will therefore be credited to the Additional Paid-in Capital account.
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Home » Business » On February 22, Brett Corporation acquired 250 shares of its $3 par value common stock for $26 each. On March 15, the company resold 66 shares for $29 each. What is true of the entry for reselling the shares
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