Lava Lake Inc. bottles and distributes spring water. On February 11 of the current year,...
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Lava Lake Inc. bottles and distributes spring water. On February 11 of the current year, Lava Lake reacquired 6,000 shares of its common stock at $85 per share. On April 30, Lava Lake Inc. sold 4,200 of the reacquired shares at $92 per share. On August 22, Lava Lake Inc. sold 1,800 shares at $80 per share.
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a. Journalize the transactions of February 11, April 30, and August 22. If an amount box does not require an entry, leave it blank.
Feb. 11CashCommon StockPaid-In Capital from Sale of Treasury StockRetained EarningsTreasury Stock- Select -- Select -CashCommon StockPaid-In Capital from Sale of Treasury StockRetained EarningsTreasury Stock- Select -- Select -Apr. 30CashCommon StockPaid-In Capital from Sale of Treasury StockRetained EarningsTreasury Stock- Select -- Select -CashCommon StockPreferred StockRetained EarningsTreasury Stock- Select -- Select -CashCommon StockPaid-In Capital from Sale of Treasury StockPreferred StockRetained Earnings- Select -- Select -Aug. 22CashCommon StockPreferred StockRetained EarningsTreasury Stock- Select -- Select -Common StockPaid-In Capital from Sale of Treasury StockPreferred StockRetained EarningsTreasury Stock- Select -- Select -CashCommon StockPaid-In Capital from Sale of Treasury StockRetained EarningsTreasury Stock- Select -- Select -
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b. What is the balance in Paid-In Capital from Sale of Treasury Stock on December 31 of the current year? $fill in the blank 17c37f05bfd7f97_1
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c. For what reasons might Lava Lake have purchased the treasury stock?
For reissuance to employees as a bonus according to stock purchase agreements.To provide shares for resale to employees.To support the market price of the stock.All of these reasons.None of these reasons.
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