Prepare journal entries for the following treasury stock transactions. Assume th

Question

Prepare journal entries for the following treasury stock transactions. Assume that all three happen in order when preparing each entry. 15.02.15 Purchased 48,000 shares for cash at $13.50 per share. 06.06.15 Sold 12,500 treasury shares for cash at $16.00 per share. 30.08.15 Sold 9,500 treasury shares for cash at $12.00 per share. Instructions: Prepare journal entries for the above transactions. Date Account Debit Credit Prepare journal entries for the following treasury stock transactions. Assume that all three happen in order when preparing each entry. 15.02.15 Purchased 48,000 shares for cash at $13.50 per share. 06.06.15 Sold 12,500 treasury shares for cash at $16.00 per share. 30.08.15 Sold 9,500 treasury shares for cash at $12.00 per share. Instructions: Prepare journal entries for the above transactions. Date Account Debit Credit

Explanation / Answer

Journal Entries are as follows:

Date Account Debit   Credit 15-02-2015 Investment in Shares A/c $   6,48,000.00 To Cash/Bank A/c $   6,48,000.00 (Being 48000 nos shares purchased @ $13.50 per Share) 06-06-2015 Cash/Bank A/c $   2,00,000.00 To Investment in Shares A/c $   2,00,000.00 (Being 12500 shares sold @ $16 per share) 30-08-2015 Cash/Bank A/c $   1,14,000.00 To Investment in Shares A/c $   1,14,000.00 (Being 9500 shares sold @ $12 per share)

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