Treasury Stock nland Corporation issued 50,000 shares of $3 par value common sto

Question

Treasury Stock nland Corporation issued 50,000 shares of $3 par value common stock at $19 per share and 9,000 shares of $27 par value, ten percent preferred stock at $77 per share. Later, the company purchased 2,000 shares of its own common stock at $21 per share. a. Prepare the journal entries to record the share issuances and the purchase of the common shares. b. Assume that Inland sold 1,500 shares of the treasury stock at $25 per share. Prepare the general journal entry to record the sale of this treasury stock. C.Assume that Inland sold the remaining 500 shares of treasury stock at $18 per share. Prepare the journal entry to record the sale of this treasury stock. General Journal Ref. Description Debit Credit Common stock ssued shares of common stock. 10% Preferred stock Issued shares of preferred stock. Acquired shares of common stock.

Explanation / Answer

A) Ref. General journal Debit Credit Cash (50,000*19) 950000 Common stock (50000*3) 150000 paid in capital in excess of par 800000 Cash (9000*77) 693000 preferred stock (9000*27) 243000 paid in capital in excess of par 450000 Treasury stock 42000 cash (2000*21) 42,000 B) Cash (1500*25) 37500 Treasury stock (1500*21) 31500 paid in capital from treasury stock 6000 C) Cash (500*18) 9000 paid in capital from treasury stock 1500 Treasury stock (500*21) 10500

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