ACC 304 All Assignments ACC 304 All Assignments | Page 47

b. capital stock.
c. retained earnings.
d. other income.
40. Porter Corp. purchased its own par value stock on January 1,
2012 for $20,000 and debited the treasury stock account for the
purchase price. The stock was subsequently sold for $12,000. The
$8,000 difference between the cost and sales price should be recorded
as a deduction from
a. additional paid-in capital to the extent that previous net "gains"
from sales of the same class of stock are included therein; otherwise,
from retained earnings.
b. additional paid-in capital without regard as to whether or not there
have been previous net "gains" from sales of the same class of stock
included therein.
c. retained earnings.