Question

Prepare the Journal Entries

• ABC re-purchased 1000 shares of their $1 par common stock for $10.

• ABC sold 500 shares of Treasury Stock for $11.(Above Cost)

• ABC sold 100 shares of Treasury Stock for $10. (At Cost)

• ABC sold the remaining shares for $8. (Below Cost)

Answer 1

Journal Entries:

S.No	Particulars	Debit($)	Credit($)
1	Treasury stock (1000*$10)	10,000
	Cash		10,000
	(Repurchase of Shares for cash at $10)
2	Cash ($11 * 500shares)	5500
	Additional Paid in capital,treasury srock		500
	Treasury stock ( $10 * 500)		5000
	(Reissue of stocks at a price above the repurchased price)
3	Cash ($10 * 100shares)	1000
	Treasury stock		1000
	( Reissue of shares at cost $10 )
4	Cash ($8 * 400shares)	3200
	Paid in capital,Treasury stock	800
	Treasury stock ( $10 * 400)		4000
	( Reissue of shares at a price less than the cost price)

Working notes:

1) Remaining shares = 1000 - 500 - 100

= 400 shares