5 6 The company is authorized to issue 200 million common shares. The transactions described below effected changes in the company's oustanding shares. Prior to the transactions the company's shareholders' equity included the following: 8 Shareholders' Equity 9 Common stock, 100 million shares at $1 par 10 APIC-CS 11 APIC - share repurchase 12 Retained earnings ($ in millions) 100 700 210 14 Part 1 15 Assuming the company retires shares it reacquires (restores their status to that of authorized but unissued shares), record the appropriate journal 16 entry for each of the following transactions 18 1. On February 7, 2021, the company reacquired 2 million shares at 54 per share 24 2. On May 23, 2021, the company reacquired 4 million shares at $7 per share. 30 3. On October 25, 2022, the company sold 2 million common shares at 58 per share 36 4. On January 25, 2022, the company sold 1 million common shares at $3 per share. 5. On April 7, 2022, the company sold 3 million common shares at $2 per share. 48 Part 2 49 Now assume that rather than retire shares, the company will treat the transactions as treasury stock transactions. The company determines cost 50 as the weighted average cost of treasury shares. Prepare the appropriate journal entry for the transactions listed in Part 1 under this different 51 method 53 1. on February 7, 2021, the company reacquired 2 million shares at 54 per share. 59 2. On May 23, 2021, the company reacquired 4 million shares at $7 per share. 3. On October 25, 2022, the company sold 2 million common shares at $8 per share. 4. On January 25, 2022, the company sold 1 million common shares at $3 per share. 5. On April 7, 2022, the company sold 3 million common shares at $2 per share