Sunshine Corp. was organized on Jan. 1 with authorization of 20,000 shares of $5 preferred stock, $100 par, and 200,000 shares of $25 par common stock. On Feb. 1 it had reacquired 500 shares of their own common stock at $32 per share. Indicate the accounts on Mar. 1 that should be recorded in the Description column of the Journal item (2) as the accounts to be credited and the amounts assuming that Sunshine Corp. reissued 500 shares of the treasury stock at $35 per share and is using the cost method. JOURNAL page 32datedescriptionp.ref.debitCREDITMar. 1(1) $17,500 (2) ? (2) ? Group of answer choicesCash credited for 12,500, and Paid-In Capital from Sale of Treasury Stock credited for $5,000Treasury Stock credited for $16,000 and Paid-In Capital from Sale of Treasury Stock credited for $1,500Cash credited for $16,000 and Paid-In Capital from Sale of Treasury Stock credited for $1,500Treasury Stock credited for $12,500 and Paid-In Capital from Sale of Treasury Stock credited for $5,000

Shares refer to the market security that the company issue to raise funds from the market by…

Answered: Sunshine Corp. was organized on Jan. 1…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Sunshine Corp. was organized on Jan. 1 with authorization of 20,000 shares of $5 preferred stock, $100 par, and 200,000 shares of $25 par common stock. On Feb. 1 it had reacquired 500 shares of their own common stock at $32 per share. Indicate the accounts on Mar. 1 that should be recorded in the Description column of the Journal item (2) as the accounts to be credited and the amounts assuming that Sunshine Corp. reissued 500 shares of the treasury stock at $35 per share and is using the cost method.

JOURNAL page 32

date	description	p.ref.	debit	CREDIT
Mar. 1	(1)		$17,500
	(2)			?
	(2)			?

Group of answer choices

Cash credited for 12,500, and Paid-In Capital from Sale of Treasury Stock credited for $5,000

Treasury Stock credited for $16,000 and Paid-In Capital from Sale of Treasury Stock credited for $1,500

Cash credited for $16,000 and Paid-In Capital from Sale of Treasury Stock credited for $1,500

Treasury Stock credited for $12,500 and Paid-In Capital from Sale of Treasury Stock credited for $5,000

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