Question

Bohemian Company has 500,000 shares of no par common stock with a stated value of $8 per share issued and outstanding as of January 1, originally issued for $14 per share. During 2018, Bohemian Company had the following transactions involving its own stock: On March 6, acquired 27,965 shares of treasury stock at a cost of $12 per share On April 18, resold 5,280 shares of treasury stock at $19 per share. On June 11, resold an additional 2,210 shares of treasury stock at $10 per share If Bohemian uses the cost method of accounting for treasury stock, what will be the balance in additional paid in capital from treasury stock as a result of these transactions?

Answer 1

• All working forms part of the answer
• Working

	Treasury Stock	Additional Paid in Capital from Treasury Stock
Beginning balance	$                          -	$                         -
Mar 6 Re acquisition	$        335,580.00
Apr 18 Re issued	$        (63,360.00)	$          36,960.00
June 11 Re issued	$        (26,520.00)	$          (4,420.00)
Ending Balance	$        245,700.00	$          32,540.00

--Working used

	Treasury Stock	Additional Paid in Capital from Treasury Stock
Beginning balance	0	0
Mar 6 Re acquisition	=27965 shares x $12
Apr 18 Re issued	=-5280 shares x $12	=5280 shares x $7 [19 – 12]
June 11 Re issued	=-2210 shares x $12	=-2210 shares x $2 [12-10]

• Answer

Balance in additional paid in capital from treasury stock as a result of these transactions = $ 32,540 [Answer]