Reference no: EM132617647

Golden Eagle Corporation issues 100 shares of $10 par value ordinary shares for $50 per share. This transaction will include a credit to Ordinary shares for:

$1,000 and a Gain on Issue of Ordinary shares for $4,000.

$1,000 and a credit to Retained Earnings for $4,000.

$1,000 and a credit to Paid-in Capital in Excess of Par for $4,000.

$5,000.

Problem 1: The purchase of treasury shares:

Option 1: increases assets and decreases shareholders' equity.

Option 2: decreases assets and decreases shareholders' equity.

Option 3: decreases assets and increases shareholders' equity.

Option 4: decreases assets and increases liabilities.

Option 5: None of the above