Michaela Corporation purchased from its stockholders 4,980 shares of its own pre
ID: 2351120 • Letter: M
Question
Michaela Corporation purchased from its stockholders 4,980 shares of its own previously issued stock for $258,960. It later resold 2,080 shares for $56 per share, then 2,080 more shares for $51 per share, and finally 820 shares for $42 per share.Instructions
Prepare journal entries for the purchase of the treasury stock and the three sales of treasury stock. (For multiple debit/credit entries, list amounts from largest to smallest e.g. 10, 5, 3, 2.)
Account/Description Debit Credit
1.
2.
(To record purchase of treasury stock.)
3.
4.
5.
(To record sale of shares $56 per share.)
6.
7.
8.
(To record sale of shares $51 per share.)
9.
10.
11.
12.
(To record sale of shares $42 per share.)
Explanation / Answer
250000/5000) x 2000 = 100000 49 x 2000 = 98000 100000-98000 = 2000 debit to paid in cap. of treasury stock for the loss 4. Cash (debit) -------- 40,000 Paid in capital -treasu ... It later resold 2,000 shares for $54 per share - Correct It later resold 2,000 more shares for $49 per share Cash(Dr) $98,000 Paid-in Capit ... let me know so I can send you a more compatible version of the file. The notes/explanations in blue font in this tutorial are for your reference only.