Oriole Company has $2580000 of short-term debt it expects to retire with proceeds from the sale of 51000 shares of common stock. There is no contractual agreement to retire the debt with the stock sale proceeds. If the stock is sold for $25 per share subsequent to the balance sheet date, but before the balance sheet is issued, what amount of short-term debt could be excluded from current liabilities?

$2580000.

$1275000.

$1305000.

$0, No contractual agreement to retire the debt with stock proceeds.

Testbank Multiple Choice Question 40

Marigold Corp. purchased its own par value stock on January 1, 2020 for $18200 and debited the treasury stock account for the purchase price. The stock was subsequently sold for $10800. The $7400 difference between the cost and sales price should be recorded as a deduction from

net income.

retained earnings.

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.

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.

Answer rating: 100% (QA)

b 1275000 25510001275000 As the payment of debt is an adjusting eve... View the full answer