Question

Court Casuals has 300,000 shares of common stock outstanding as of the beginning of the year and has the following transactions affecting stockholders' equity during the year.

May		18		Issues 22,000 additional shares of $1 par value common stock for $43 per share.
May		31		Purchases 5,000 shares of treasury stock for $44 per share.
July		1		Declares a cash dividend of $2 per share to all stockholders of record on July 15. Hint: Dividends are not paid on treasury stock.
July		31		Pays the cash dividend declared on July 1.
August		10		Resells 2,200 shares of treasury stock purchased on May 31 for $50 per share.

Record each of these transactions. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)

Answer 1

Journal Entries
Sr. No.	Date	Account Title and explanation	Debit	Credit
1	May,18	Cash(22,000 Shares X $ 43)	$9,46,000
		Common Stock (22,000 Shares X $ 1)		$22,000
		Paid in Capital in excess of par		$9,24,000
		(Record the purchae of Common stock)
2	May, 31	Treasurry stock (5000 shares X $ 44)	$2,20,000
		Cash		$2,20,000
		(To Record the purchase of treasurry Stock)
3	July, 01	Retained Earnings(317,000 Shares X $ 2)	$9,51,000
		Dividend Payable		$9,51,000
4	July, 15	"No Journal Entry"
5	July, 31	Dividend Payable	$9,51,000
		Cash		$9,51,000
		Cash (2,200 Shares X $ 50)	$1,10,000
6	Aug, 10	Treasurry Stock (2200 Shares X $ 44)		$96,800
		Addittional Paid in Capital - Treasurry Stock		$13,200