Shelton Corp. was involved in the following transactions. Jan.1 Issued 100000 shares of common stock, $2...

Shelton Corp. was involved in the following transactions.

Jan.1 Issued 100000 shares of common stock, $2 par, for $12

Mar.1 Reacquired 20000 shares at $30.

July 1 Reissued 14000 shares at $40.

Sept.1 Reissued 5000 shares at $32.

Dec.1 Retired the remaining treasury stock shares.

Required. Prepare the required journal entries under both the par value and cost methods. Prepare the entries for all the par value transactions, then prepare all the cost method transactions.

Expert Solution

	Cash Method

Date	Accounts Name	Debit	Credit


jan 1	Cash	1200000
	Common Stock ( 100000 * 2 )		200000
	Additional paid in Capital		1000000
	( to record the issue of Common Stock )


mar 1	trasuty stock ( 20000 * 30 )	600000
	Cash		600000
	( to record the shares repurchased @ $30 PER share )


july 1	Cash ( 14000 * 40 )	560000
	Additional Paid in Capital - treasury Stock ( 14000 * ( 40-30) )		140000
	treasury Stock ( 14000 * 30)		420000



Sep 1	Cash (5000* 32)	160000
	additional paid in capital - treasury stock ( 5000*(32 - 30) )		10000
	treaury Stock ( 5000 * 30)		150000

	Retirement of ( 20000 – 14000-5000) 1000 Shares

Dec 1	Common Stock ( 1000 * parvalue (2) )	2000
	Additional Paid in Capital - treasury Stock ( 1000 * ( 30-2) )	28000
	Treasury Stock ( 1000 * 30)		30000

	par value method


Date	Accounts Name	Debit	Credit


jan	Cash	1200000
	Common Stock ( 100000 * 2 )		200000
	Additional paid in Capital		1000000
	( to record the issue of Common Stock )


	trasuty stock ( 20000 * 2 )	40000
	Additional paid in Capital	560000
	Cash		600000
	( to record the shares repurchased @ $30 PER share )


	Cash ( 14000 * 40 )	560000
	Additional Paid in Capital - treasury Stock ( 14000 * ( 40-2) )		532000
	treasury Stock ( 14000 * 2)		28000



	Cash (5000* 32)	160000
	additional paid in capital - treasury stock ( 5000*(32 – 2) )		150000
	treaury Stock ( 5000 * 2)		10000

	Retirement of ( 20000 – 14000-5000) 1000 Shares

	Common Stock ( 1000 * parvalue (2) )	2000
	Treasury Stock ( 1000 * 2)		2000

ekkarill92 answered 1 year ago

Sheffield Corp. issued 100000 shares of $10 par common stock for $1340000. A year later Sheffield...

Sheffield Corp. issued 100000 shares of $10 par common stock for $1340000. A year later Sheffield acquired 16100 shares of its own common stock at $15 per share. Three months later Sheffield sold 8200 of these shares at $19 per share. If the cost method is used to record treasury stock transactions, to record the sale of the 8200 treasury shares, Sheffield should credit

Apple has the following at Jan 1, 2018 2,000,000 shares of common stock issued and $1...

Apple has the following at Jan 1, 2018 2,000,000 shares of common stock issued and $1 par outstanding 4,000,000 shares authorized Additional paid in capital $5,750,000 retained earnings $12,345,000 During 2018 the following occured Net income: $6,789,000 cash dividend declared May 15: $.70 per share cash dividends paid on Jun 30th stock dividends declared on November 30th : 17% stock dividend distributed on 12/31 the market price of the stock has been $36 all year Prepare journal entries to record...

Howard Inc. reports the following transactions relating to its stock accounts. Jan 1 Issued 40,000 shares...

Howard Inc. reports the following transactions relating to its stock accounts. Jan 1 Issued 40,000 shares of $8 par value common stock at $20 each per share. Mar 5 Issued 8,000 shares of $35 par value, 6% preferred stock at $50 cash per share. June 15 Purchased 7,000 shares of its own common stock at $18 cash per share. Aug 4 Sold 6,500 shares of the treasury stock at $28 cash per share. Sep 15 Declared a 5% common...

ABC Corp. completed the following transactions during 2018: 1. Issued 1,998 shares of $1 par common...

ABC Corp. completed the following transactions during 2018: 1. Issued 1,998 shares of $1 par common stock for $17 per share. 2. Repurchased 312 shares of its own common stock for $24 per share. 3. Resold 226 shares of treasury stock for $28 per share. What is the balance of the PIC, Treasury stock account after these transactions?

PROBLEM 2 On January 1, 2016, Biden Corp. issued shares of its common stock to acquire...

PROBLEM 2 On January 1, 2016, Biden Corp. issued shares of its common stock to acquire all of the outstanding common stock of Raffie Inc. Raffie’s book value was only $140,000 at the time, but Biden issued 12,000 shares having a par value of $1 per share and a fair value of $20 per share. Biden was willing to convey these shares because it felt that buildings (ten-year life) were undervalued on Raffie's records by $60,000 while equipment (five-year life)...

Complete the journal entries Jan. 1 - Issued 6,500 shares of no-par common stock for $10...

Complete the journal entries Jan. 1 - Issued 6,500 shares of no-par common stock for $10 per share. Jan. 1 - Purchased a computer equipment for $5,000. Monthly depreciation for the equipment is $250. Jan. 3 – Paid $3,000 in rent on the warehouse building for the month of January Jan. 6 - Purchased office supplies for $6,000. Jan. 10 - Performed repairs and maintenance on their machine costing $1,500. Jan. 11 - Purchased inventory on account for $95,000. Jan....

 McNichols Corp. reports the following transactions relating to its stock accounts. Jan. 15 Issued 25,000...

 McNichols Corp. reports the following transactions relating to its stock accounts. Jan. 15 Issued 25,000 shares of $5 par value common stock at $17 cash per share. Jan. 20 Issued 6,000 shares of $50 par value, 8% preferred stock at $78 cash per share. Mar. 31 Purchased 3,000 shares of its own common stock at $20 cash per share. June 25 Sold 2,000 shares of the treasury stock at $26 cash per share. July 15 Sold the remaining 1,000...

During 2019, Road Pavement Corp. engaged in the following selected transactions: Jan 01: Issued 25,000 shares...

During 2019, Road Pavement Corp. engaged in the following selected transactions: Jan 01: Issued 25,000 shares of $2 par value common stock at $5 per share. Jun 15: Re-acquired 1,000 shares of common stock sold in Jan for $4 per share. Aug 10: Sold 400 shares of its re-acquired common stock purchased in June for $7 per share. Sept 30: The Board of Directors declared and recorded a cash dividend of $0.20 per share outstanding to its share holders. Nov ...

Promising Corp starts the year with 25,000 shares of $1 par common stock issued at an...

Promising Corp starts the year with 25,000 shares of $1 par common stock issued at an average cost of $24 each. Record each of the following sequential entries.1.) Repurchase 2,000 shares for $18 each; 2.) Sell 1,000 of the shares in #1 for $26 each; 3.) Sell 800 shares of the stock repurchased in #1 for $9 each; 4.) Retire the remaining 200 shares repurchased in #1. After the 4th entry, how many shares are issued? Outstanding?

On January 1, 2016, A Corp. issued shares of its common stock to acquire all of...

On January 1, 2016, A Corp. issued shares of its common stock to acquire all of the outstanding common stock of B Inc. B’s book value was only $140,000 at the time, but A issued 12,000 shares having a par value of $1 per share and a fair value of $20 per share. A was willing to convey these shares because it felt that buildings (ten-year life) were undervalued on B's records by $60,000 while equipment (five-year life) was undervalued...

Question