Ayayai Corporation had the following stockholders’ equity accounts on January 1, 2020: Common Stock ($5 par)...

Ayayai Corporation had the following stockholders’ equity accounts on January 1, 2020: Common Stock ($5 par) $500,000, Paid-in Capital in Excess of Par—Common Stock $200,000, and Retained Earnings $120,000. In 2020, the company had the following treasury stock transactions.

Mar.	1	Purchased 5,500 shares at $9 per share.
June	1	Sold 1,000 shares at $13 per share.
Sept.	1	Sold 1,000 shares at $11 per share.
Dec.	1	Sold 1,500 shares at $7 per share.

Ayayai Corporation uses the cost method of accounting for treasury stock. In 2020, the company reported net income of $30,000.

Prepare the stockholders’ equity section for Ayayai Corporation at December 31, 2020. (Enter the account name only and do not provide the descriptive information provided in the question.)

Expert Solution

Date	General Journal	Debit	Credit
Mar-01	Treasury stock	$ 49,500.00
	Cash		$ 49,500.00
	(Purchase of treasury stock)

Jun-01	Cash	$ 13,000.00
	Paid in capital - Treasury stock		$ 4,000.00
	Treasury stock		$ 9,000.00
	(Sold treasury stock)

Sep-01	Cash	$ 11,000.00
	Paid in capital - Treasury stock		$ 2,000.00
	Treasury stock		$ 9,000.00
	(Sold treasury stock)

Dec-01	Cash	$ 10,500.00
	Paid in capital - Treasury stock	$ 3,000.00
	Treasury stock		$ 13,500.00
	(Sold treasury stock)

Working

Date	General Journal	Debit	Credit
Mar-01	Treasury stock	=5500*9
	Cash		=5500*9
	(Purchase of treasury stock)

Jun-01	Cash	=1000*13
	Paid in capital - Treasury stock		=13000-9000
	Treasury stock		=1000*9
	(Sold treasury stock)

Sep-01	Cash	=1000*11
	Paid in capital - Treasury stock		=11000-9000
	Treasury stock		=1000*9
	(Sold treasury stock)

Dec-01	Cash	=1500*7
	Paid in capital - Treasury stock	=1500*2
	Treasury stock		=1500*9
	(Sold treasury stock)

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