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8 April, 19:10

The Jennings Group reacquired 2 million of its shares at $70 per share as treasury stock. Last year, for the first time, Jennings sold 1 million treasury shares at $71 per share. By what amount will Jennings' retained earnings decline if it now sells the remaining 1 million treasury shares at $67 per share?

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  1. 8 April, 21:30
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    Thge retained earnings account will decrease by 2,000,000

    Explanation:

    treasury stock cost: $70 per share.

    treasury stock 140,000,000 debit

    cash 140,000,000 credit

    it sold 1,000,000 shares to 71 dollars

    cash 71,000,000 debit

    treasury stock 70,000,000 credit

    additonal paid-in TS 1,000,000 credit

    and then sales 1,000,000 to 67 dollars

    cash 67,000,000 debit

    additional paid-in TS 1,000,000 debit

    retained earnings 2,000,000 debit

    treasury stock 70,000,000 credit
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Home » Business » The Jennings Group reacquired 2 million of its shares at $70 per share as treasury stock. Last year, for the first time, Jennings sold 1 million treasury shares at $71 per share.
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