Prepare the journal entries necessary for the following Treasury Stock transacti
ID: 2466979 • Letter: P
Question
Prepare the journal entries necessary for the following Treasury Stock transactions.
Create T-Account for the Paid in Capital – Treasury Stock account.
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Paid in Capital -- Treasury Stock On May 11, 2015, CCO Inc. purchased 8,000 of its own shares (Treasury Stock) for $160,000. On August 15, 2015, CCO Co. resold 3,000 of its Treasury Stock for $72,000. On September 12, 2015, CCO Co. resold 2,000 of its Treasury Stock for $34,000. On October 2, 2015, CCO Co. resold 1,000 of its Treasury Stock for $13,000.
Explanation / Answer
11-May Treasury stock Dr 160000 Cash Cr 160000 ( To record purchase of 8000 treasury stock @ 20 each) 15-Aug Cash Dr 72000 Treasury Stock Cr 60000 Additional paid in capital Cr 12000 ( To record resale of 3000 treasury stock @ 24 each) 12-Sep Cash Dr 34000 Discount on issue if treasury stock Dr 6000 Treasury stock Cr 40000 ( To record issue of 2000 treasury stock @ 17 each) 2-Oct Cash Dr 13000 Discount on issue if treasury stock Dr 7000 Treasury stock Cr 20000 ( To record issue of 1000 treasury stock @ 17 each) Paid in capital - Treasury stock 11-May To Cash 160000 15-Aug By Cash 60000 12-Sep By Cash 40000 2-Oct By Cash 20000 By bakance c/d 40000 160000 160000