Question

On march 1st, jones corporation purchased 1,000 shares of previously issued common stock, paying $2 per share. on april 1st, jones sold 500 shares at $3 per share. what is the amount of paid-in capital from treasury stock transactions for the sale of 500 shares?

Answer 1

Paid-in capital from treasury stock is the amount of difference between the cost and the sale price of the treasury stock.

In the given problem the treasury shares were purchased for $2 per share and 500 shares are sold for $3 per share. Hence Paid-in capital from treasury stock shall be 3-2 = $1 per share and Total Paid-in capital from treasury stock shall be 500 shares * $ = $500

Hence the answer is $500