Question
In: Accounting
On January 1, 2017, Fascom had the following account balances in its shareholders' equity accounts. Common...
On January 1, 2017, Fascom had the following account balances in its shareholders' equity accounts.
|
Common stock, $1 par, 250,000 shares issued |
250,000 |
|
Paid-in capital–excess of par, common |
500,000 |
|
Paid-in capital–excess of par, preferred |
100,000 |
|
Preferred stock, $100 par, 10,000 shares issued |
1,000,000 |
|
Retained earnings |
2,000,000 |
|
Treasury stock, at cost, 5,000 shares |
25,000 |
During 2017, Fascom Inc. had several transactions relating to common stock.
|
January 15: |
Bought for retirement 10,000 common shares at $ 5 per share. |
|
February 17: |
Sold 1,000 share of the treasury shares at $7 per share. |
|
April 10: |
Reissued 4,000 of the retired shares (of January 8th) at $8 per share. |
Required:
a. Journalise the above transactions by copying (control C) the below table and pasting (control V) into your answer.
b. What will the Retained Earnings account balance be after taking the above transactions into regard?
Solutions
Expert Solution
a.
| Date | Account Titles | Debit | Credit |
| Jan. 15 | Common Stock | $ 10,000 | |
| Paid-in capital–excess of par, common | $ 20,000 | ||
| Retained Earnings | $ 20,000 | ||
| Cash | $ 50,000 | ||
| Feb. 17 | Cash | $ 7,000 | |
| Treasury Stock | $ 5,000 | ||
| Paid in Capital from Treasury stock | $ 2,000 | ||
| Apr. 10 | Cash | $ 32,000 | |
| Common Stock | $ 4,000 | ||
| Paid-in capital–excess of par, common | $ 28,000 |
b. Retained Earnings Account Balance = $2000000-20000 = $1,980,000
ekkarill92 answered 2 years agoRelated Solutions
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