Problem 11-2A Fechter Corporation had the following stockholders\' equity accoun
ID: 2582201 • Letter: P
Question
Problem 11-2A Fechter Corporation had the following stockholders' equity accounts on January 1, 2015: Common Stock ($5 par) $532,900, Paid-in Capital in Excess of Par-Common Stock $199,950, and Retained Earnings $119,670. In 2015, the company had the following treasury stock transactions Mar. 1 Purchased 6,380 shares at $9 per share. June 1 Sold 1,500 shares at $13 per share. Sept.1 Sold 1,520 shares at $11 per share Dec. 1 Sold 1,420 shares at $6 per share Fechter Corporation uses the cost method of accounting for treasury stock. In 2015, the company reported net income of $29,800Explanation / Answer
Date Account titles and Explanations Debit Credit 1-Mar Treasury stock (6,380*9) 57420 cash 57,420 1-Jun cash (1500*13) 19500 treasury stock (1500*9) 13500 paid in capital from treasury stock 6000 1-Sep Cash (1520*11) 16720 Treasury stock (1520*9) 13680 paid in capital from treasury stock 3040 1-Dec cash (1420*6) 8520 paid in capital from treasurty stock 4260 Treasury stock 12780 31-Dec income sumary 29,800 retained earnings 29,800 Balance Sheet (Partial) Stockholders Equity Paid in Capital Capital Stock Common stock 532,900 Addittional paid in capital paid in capital in excess of par -CS 199,950 paid in capital from Treasury stock 4780 total Addittional paid in capital 204,730 total paid in capital 737,630 Retained Earnings 149470 total paid in capital & Retained earnings 887,100 less:Treasury stock -17460 total Stockholders Equity 869,640