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During the current year, Onal Co. purchased 10,000 shares of its own stock at $7 per share. The stock was originally issued at $6. The firm sold 5,000 of the treasury shares for $10 per share. The firm uses the cost method to account for treasury stock. What amount should Onal report in its income statement for these transactions?

Respuesta :

Answer:

What amount should Onal report in its income statement for these transactions? 0.

Explanation:

                                  deb               cre

year-1 Treasury Stock 70000  

(10000*7)  

Cash                                           70000

   

year-1 Cash                  50000  

(5000*10)  

Treasury Stock                            35000

(5000*7)  

Paid in capital for treasury stock  15000

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