Question

In 2018, Western Transport Company entered into the treasury stock transactions described below. In 2016, Western Transport had issued 280 million shares of its $1 par common stock at $28 per share. Required: Prepare the appropriate journal entry for each of the following transactions: (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) On January 23, 2018, Western Transport reacquired 20 million shares at $31 per share. On September 3, 2018, Western Transport sold 2 million treasury shares at $32 per share. On November 4, 2018, Western Transport sold 2 million treasury shares at $29 per share.

Answer 1

• All working forms part of the answer

Date	Accounts title	Debit	Credit	Working
23-Jan	Treasury Stock	$                              620		[20 million shares x $ 31]
	Cash		$                              620	[20 million shares x $ 31]
	(Shares re acquired)
03-Sep	Cash	$                                64		[2 million x $ 32]
	Treasury Stock		$                                62	[2 million x $ 31]
	Paid in Capital from sale of Treasury Stock		$                                  2	[2 million x $ 1]
	(Shares re issued)
04-Nov	Cash	$                                58		[2 million shares x $ 29]
	Paid in Capital from sale of Treasury Stock	$                                   2		[balance available]
	Retained earnings	$                                   2		[balancing figure]
	Treasury Stock		$                                62	[2 million shares x $ 31]
	(Shares re issued)