In 2018, Southwestern Corporation completed the treasury stock transactions list
ID: 2529563 • Letter: I
Question
In 2018, Southwestern Corporation completed the treasury stock transactions listed below February 2: Reacquired 69,00e shares at $11.99. March 17: Sold 19,e09 treasury shares at $13.95 Southwestern had issued 100,000 shares of its $1 par common stock for $10 several months ago. Prepare the journal entries to record the above transactions. (If no entry is required for a transaction/event, select "No journal entry May 17: Sold 24,888 treasury shares at 7.95. Pepuare the journal entries to record the above ransactions (f no entry is required for a transactionlevent, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet 2 Reacquired 69,000 shares at $11.90 Note: Enter debits before cr?dits DebitCredit Date General Journal February 02, 2018Explanation / Answer
Southwestern Corporation
Journal Entries
Date
Account Titles and Explanation
Debit
Credit
2-Feb-18
Treasury Stock
$821,100
Cash
$821,100
(To record reacquisiton of 69,000 shares)
17-Mar-18
Cash
$265,050
Treasury Stock
$226,100
Paid-in Capital Treasury Stock
$38,950
(To record sale of 19,000 shares of treasury stock and paid-in capital in excess of cost, (13.95 -11.90) x 19,000)
17-May-18
Cash
$190,800
Paid-in capital, Treasury Stock
$38,950
Retained Earnings
$55,850
Treasury Stock
$285,600
(To record sale of 24,000 shares of treasury stock, and paid-in capital $94,800 (24,000 x (11.9-7.95))
Computations –
Purchase price of each share = $11.90
Sale price= $13.95
Paid-in capital = $2.05
Paid-in capital on sale of 19,000 shares = 19,000 x $2.05 = $38,950
Purchase price = $11.90
Excess of purchase price over sale price = 11.90 -7.95 = $3.95; $3.95 x 24,000 = $94,800
Partly from paid-in capital, Treasury stock = $38,950
Balance from Retained Earnings$55,850
Date
Account Titles and Explanation
Debit
Credit
2-Feb-18
Treasury Stock
$821,100
Cash
$821,100
(To record reacquisiton of 69,000 shares)
17-Mar-18
Cash
$265,050
Treasury Stock
$226,100
Paid-in Capital Treasury Stock
$38,950
(To record sale of 19,000 shares of treasury stock and paid-in capital in excess of cost, (13.95 -11.90) x 19,000)
17-May-18
Cash
$190,800
Paid-in capital, Treasury Stock
$38,950
Retained Earnings
$55,850
Treasury Stock
$285,600
(To record sale of 24,000 shares of treasury stock, and paid-in capital $94,800 (24,000 x (11.9-7.95))