Question

Yukiyu Co. had the following transactions during the current period. Mar. 2 Issued 6,000 shares of $5 par value common stock to attorneys in payment of a bill for $36,000 for services performed in helping the company to incorporate. June 12 Issued 72,000 shares of $5 par value common stock for cash of $375,000. July 11 Issued 1,200 shares of $100 par value preferred stock for cash at $110 per share. Nov. 28 Purchased 2,500 shares of treasury stock for $80,000.

Instructions: Journalize the transactions

On January 1, 2017, the stockholders’ equity section of NotMy Corporation shows common stock ($10 par value) $3,000,000; paid-in capital in excess of par $2,000,000; and retained earnings $2,400,000. During the year, the following treasury stock transactions occurred. Mar. 1 Purchased 50,000 shares for cash at $12 per share. July 1 Sold 10,000 treasury shares for cash at $15 per share. Sept. 1 Sold 8,000 treasury shares for cash at $10 per share. Instructions (a) Journalize the treasury stock transactions. (b) Restate the entry for September 1, assuming the treasury shares were sold at $9 per share

Answer 1

ANSWER :-

1.

Date	Accounts title	Debit	Credit
Mar.2	Attorneys Expense	$36,000
	Common Stock ( 6000*$5)		$30,000
	Additional paid-in Capital Common Stock		$6,000
	( To record issue of common stock for payment of attorney fees )
June.12	Cash	$3,75,000
	Common Stock ( 72,000*$5)		$3,60,000
	Paid-in Capital - Common Stock		$15,000
	( To record issue of common stock )
July. 11	Cash (1200*$110)	$1,32,000
	preferred Stock ( 1200*$100)		$1,20,000
	Paid-in Capital - preferred stock		$12,000
	( To record issue of preferred stock )
Nov. 28	Treasury stock	$80,000
	Cash		$80,000
	( To record repurchase of own stock )

2.

Date	Accounts title	Debit	Credit
Mar.1	Treasury Stock ( 50,000*$12)	$6,00,000
	Cash		$6,00,000
	(to record purchase of treasury stock for cash )
July.1	Cash ( 10,000*15)	$1,50,000
	Treasury Stock ( 10,000*$12)		$1,20,000
	Paid-in Capital - Treasury Stock ( 10,000*3)		$30,000
	( To record sale of treasury stock for cash )
Sep.1	Cash ( 8000*$10)	$80,000
	Paid in Capital From Treasury Stock ( 8000*2)	$16,000
	Treasury Stock (8000*$12)		$96,000
	( To record sale of treasury stock of cash)
Sep.1	Cash ( 8000*$9)	$72,000
	Paid in Capital from treasury stock ( 8000*$3)	$24,000
	Treasury Stock ( 8000*12)		$96,000
	( To record sales of treasury stock for cash )