Dougherty Corporation had the following stockholders equity accounts on January 1, 2012 Common Stock ($1 par) $400,000, Paid in Capital in Excess of Par Common Stock $500,000, and Retained Earnings $100,000 In 2012, the company had the following treasury stock transactions Mar 1 Purchased 5,000 sha...

a b c Mar 1 Treasury Stock 5000 X 7 Cash June 1 Sept ...

Dougherty Corporation had the following stockholders equity accounts on January 1, 2012: Common Stock ($1 par) $400,000,

Question:

Dougherty had the following stockholders’ equity accounts on January 1, 2012: ($1 par) $400,000, Paid-in Capital in Excess of Par— $500,000, and Retained Earnings $100,000. In 2012, the company had the following treasury stock transactions.
Mar. 1 Purchased 5,000 shares at $7 per share.
June 1 Sold 1,000 shares at $10 per share.
Sept. 1 Sold 2,000 shares at $9 per share.
Dec. 1 Sold 1,000 shares at $5 per share.
Dougherty uses the cost method of accounting for treasury stock. In 2012, the company reported net income of $80,000.
Instructions
(a) Journalize the treasury stock transactions, and prepare the closing entry at December 31, 2012, for net income.
(b) Open accounts for
(1) Paid-in Capital from Treasury Stock,
(2) Treasury Stock, and
(3) Retained Earnings. Post to these accounts using J12 as the posting reference.
(c) Prepare the stockholders’ equity section for Dougherty at December 31, 2012.

Common Stock
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