k-) ? |-Secure l https://newconnect.mheducation.com/flow/connect.html Chapter 18

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k-) ? |-Secure l https://newconnect.mheducation.com/flow/connect.html Chapter 18 HW Saved Help Save & Exit Su Check my wo 9 At December 31, 2017, the balance sheet of Meca International included the following shareholders' equity accounts Shareholders' Equity Common stock, 95 million shares at $1 par Paid-in capital-excess of par Retained earning (S in millions) $ 95 370 480 points eBook Required: Assuming that Meca International views its share buybacks as treasury stock, record the appropriate journal entry for each of the following transactions: (If no entry is required for a transaction/event, select "No journal entry required" in the first account Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) Hint Print References 1. On February 12, 2018, Meca reacquired 2 million common shares at $18 per share. 019. Meca reacquired 3 million common shares at $13 per share. 020, Meca sold 3 million treasury shares at $20 per share-determine cost as the weighted-average cost of treasury 2. On June 9, 2 3. On May 25. 2 shares 4. For the previou s transaction, assume Meca determines the cost of treasury shares by the FIFO method. View transaction list View journal entry worksheet Debit Credit General Journal No Date 36 February 12, Treasury stock 2018 36 Cash Prey 9 of 10 :ii score answer>

Explanation / Answer

On February 12, 2018, Meca reacquired 2 million common shares at $18 per share

General Journal

Debit

Credit

Treasury stock (2 million x $18)

36 m

Cash

36 m

On June 9, 2019, Meca reacquired 3 million common shares at $13per share.

General Journal

Debit

Credit

Treasury stock (3 million x $13)

39 m

Cash

39 m

On May 25, 2020, Meca sold 3 million treasury shares at $20 per share – determine the cost as the weighted average cost of treasury shares.

2/12                   (2 million x $18)              36000000

6/9                      (3 million x $13)              39000000

                            5 million                          75000000

Weighted average: $75000000 ÷ 5000000 = $15/share

General Journal

Debit

Credit

Cash (3 million x $20)

60

PIC from share repurchase

15

Treasury stock (3 million x $15)

45

For the previous transaction, assume that Meca determines the cost of treasury shares by the FIFO method.

2/12                   2 million x $18          

6/9                      3 million x $13          

General Journal

Debit

Credit

Cash (3 million x $20)

60

PIC from share repurchase

2

Treasury stock (2 million x $18) + (2 million x $13)

62

General Journal

Debit

Credit

Treasury stock (2 million x $18)

36 m

Cash

36 m

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