Question 1 Not complete Marked out of 200 P Flag question Th

Question 1 Not complete Marked out of 2.00 P Flag question The Salad Corporation sold treasury stock for $4,987,000. What is the effect on the corporation\'s revenue Select one: a. Increases revenue as other Income b. Increases revenue as Sales C. Decreases revenue as an Expense d. No effect on revenue Check e to search

Solution

Answer - (d) - No effect on revenue

Sales of treasury stock effect on Balance sheet Items and it does not effect the Items of Income statement

Journal Entry on sale of treasury stock (Assuming issue rate is at par value)

Hence it effects only two items i.e. cash And treasury stock and it does not ghave any effect on revenue.

Accounts Title	Debit	Credit
Cash	$4987000
Treasury stock		$4987000
(Treasury stock sold and cash received)