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Q1.NO. All transactions related to treasury stock are confined to the balance sheet and do not appear in the income statement. Any profits or losses realized from sale of treasury stock are either charged to the retained earnings account or to the additional paid-in capital account.
Q2.
A. Bonds are issued at Face Value
When bonds are issued at face value, the total amount of money received from the sale of the bonds is debited to the cash account, while the bonds face value is credited to the bonds payable account. With regard to the interest expense recognized, the bond interest expense is debited by the amount of interest expense paid while the cash account is credited by the amount of money paid in interest for that period....
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