Please provide the answer in detail! Kanish Corporation\'s general ledger includ

Question

Please provide the answer in detail!

Kanish Corporation's general ledger includes the following account balances: Contributed Surplus $9,000 Common Shares $260,000 Retained Eamings $83,000 The Contributed Surplus account arose from net excess of proceeds over cost on a previous cancellation of common shares. The average cost of the common shares bought and cancelled in the first two transactions is $20 per share. Assuming that the above balances existed before any of the transactions that follow, record the journal entries for each transaction (a) Bought and cancelled 470 shares at $37 per share. (b) Bought and cancelled 210 shares at $46 per share. (c) Sold 3,100 shares at $42 per share. (d) Sold 1,900 shares at $45 per share. (e) Bought and cancelled 1,200 shares at $49 per share.

Explanation / Answer

Journal Entries :- (I assum that Face Value of share is $20)

S. No. Particulars Debit($) Credit($) a) Common Shares A/c Dr. (470*$37) 17390 To Cash A/c (470*$20) 9400 To General Reserve A/c ($17390-$9400) 7990 b) Common Stock A/c Dr.(210*$46) 9660 To Cash A/c (210*$20) 4200 To General Reserve A/c ($9660-$4200) 5460 c) Cash A/c Dr. (3100*$42) 130200 To Common stock (3100*$20) 62000 To Paid in Capital A/c (3100*($42-$20) 68200 d) Cash A/c Dr. (1900*$45) 85500 To Common stock A/c (1900*$20) 38000 To Paid in Capital A/c (1900*($45-$20)) 47500 e) Common Stock A/c Dr. (1200*$49) 58800 To Cash A/c (1200*$20) 24000 To General Reserve A/c (1200*($49-20) 34800 f) General Reserve A/c Dr.($7990+$5460+$34800) 48250 To Capital Redemtion Reserve A/c 48250

Related Questions

Navigate

• Browse (All)
• Browse P
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.