Lava Lake Inc. bottles and distributes spring water. On February 11 of the current year, Lava Lake reacquired 41,500 shares of its common stock at $42 per share. On April 30, Lava Lake Inc. sold 29,800 of the reacquired shares at $55 per share. On August 22, Lava Lake Inc. sold 11,700 shares at $41 per share. Required: A. Journalize the transactions of February 11, April 30, and August 22. Refer to the Chart of Accounts for exact wording of account titles. B. What is the balance in Paid-In Capital from Sale of Treasury Stock on December 31 of the current year? C. For what reasons might Lava Lake have purchased the treasury stock?

Lava Lake Inc. bottles and distributes spring water. On February 11 of the current year, Lava Lake reacquired 41,500 shares of its common stock at $42 per share. On April 30, Lava Lake Inc. sold 29,800 of the reacquired shares at $55 per share. On August 22, Lava Lake Inc. sold 11,700 shares at $41 per share. Required: A. Journalize the transactions of February 11, April 30, and August 22. Refer to the Chart of Accounts for exact wording of account titles. B. What is the balance in Paid-In Capital from Sale of Treasury Stock on December 31 of the current year? C. For what reasons might Lava Lake have purchased the treasury stock?

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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