Inland Corporation issued 50,000 shares of $3 par value common stock at $21 per
ID: 2573037 • Letter: I
Question
Inland Corporation issued 50,000 shares of $3 par value common stock at $21 per share and 9,000 shares of $30 par value, ten percent preferred stock at $85 per share. Later, the company purchased 2,000 shares of its own common stock at $23 per share. a. Prepare the journal entries to record the share issuances and the purchase of the common shares b. Assume that Inland sold 1,500 shares of the treasury stock at $28 per share. Prepare the general journal entry to record the sale of this treasury stock. c. Assume that Inland sold the remaining 500 shares of treasury stock at $20 per share. Prepare the journal entry to record the sale of this treasury stock General Journal Ref Description Debit Credit a. Cash 0 Common stock Paid-in capital in excess of par value Common stock Issued shares of common stock Cash Paid-in capital from treasury stock Paid-in capital in excess of par value- Common stock Paid-in capital in excess of par value Preferred stock Treasury stock 0 Issued shares of preferred stock
Explanation / Answer
Journal Entries Ref. Description Debit Credit a. Cash $1,050,000 Common Stock $150,000 Paid in Capital in excess of par value - Common stock $900,000 (issued shares of common stock) Cash $765,000 10% Preferred stock $270,000 Paid in Capital in excess of par value -Preferred stock $495,000 (issued shares of preferred stock) Treasury Stock $46,000 Cash $46,000 (Acquired 2000 shares of Common stock) b. Cash $42,000 Treasury Stock $34,500 Paid in Capital from Treasury stock $7,500 (Sold 1500 shares of Treasury stock) c Cash $10,000 Paid in Capital from Treasury stock $1,500 Treasury Stock $11,500 (Sold 500 shares of Treasury stock)