a company reported the following stockholders equity on january 1 of the current year: common stock -$10 par…

a company reported the following stockholders equity on january 1 of the current year: common stock -$10 par value, 1,000,000 shares authorized; 252,000 shares issued paid - in capital in excess of par value, common stock $2,520,000 retained earnings 1,262,000 total stockholders equity 1,677,000 $5,459,000 prepare journal entries for the following selected transactions. march 1 purchased 10,200 shares of its own stock for $15 cash per share. may 5 sold 4,200 shares of its own stock for $15 cash per share. october 12 sold 2,200 shares of its treasury stock for $16 cash per share. view transaction list journal entry worksheet 1 2 3 purchased 10,200 shares of its own stock for $15 cash per share. note: enter debits before credits.

a company reported the following stockholders equity on january 1 of the current year: common stock -$10 par value, 1,000,000 shares authorized; 252,000 shares issued paid - in capital in excess of par value, common stock $2,520,000 retained earnings 1,262,000 total stockholders equity 1,677,000 $5,459,000 prepare journal entries for the following selected transactions. march 1 purchased 10,200 shares of its own stock for $15 cash per share. may 5 sold 4,200 shares of its own stock for $15 cash per share. october 12 sold 2,200 shares of its treasury stock for $16 cash per share. view transaction list journal entry worksheet 1 2 3 purchased 10,200 shares of its own stock for $15 cash per share. note: enter debits before credits.

Answer

Explanation:

Step1: Record the purchase of treasury stock on March 1

When a company purchases its own stock, the treasury - stock account is debited and cash is credited. The cost of the treasury stock is the number of shares purchased times the purchase price per share. Debit: Treasury Stock (10,200×$15) = $153,000 Credit: Cash $153,000

Step2: Record the sale of treasury stock on May 5

When treasury stock is sold at cost, cash is debited and treasury stock is credited. Debit: Cash (4,200×$15) = $63,000 Credit: Treasury Stock $63,000

Step3: Record the sale of treasury stock on October 12

When treasury stock is sold above cost, cash is debited for the amount received, treasury stock is credited at cost, and the excess is credited to Paid - in Capital from Treasury Stock. Debit: Cash (2,200×$16) = $35,200 Credit: Treasury Stock (2,200×$15) = $33,000 Credit: Paid - in Capital from Treasury Stock ($35,200 - $33,000) = $2,200

Answer:

Date Account Titles and Explanation Debit ($) Credit ($)
March 1 Treasury Stock 153,000
Cash 153,000
May 5 Cash 63,000
Treasury Stock 63,000
October 12 Cash 35,200
Treasury Stock 33,000
Paid - in Capital from Treasury Stock 2,200