CP11-1 Analyzing Accounting Equation Effects, Recording Journal Entries, and Preparing a Partial Balance Sheet Involving Stock Issuance, Purchase, and Reissuance Transactions [LO 11-2]

[The following information applies to the questions displayed below.]

Worldwide Company obtained a charter from the state in January that authorized 200,000 shares of common stock, $10 par value. During the first year, the company earned $38,900 and the following selected transactions occurred in the order given:

a.	Issued 67,000 shares of the common stock at $11 cash per share.
b.	Reacquired 2,700 shares at $14 cash per share from stockholders; the shares are now held in treasury.
c.	Reissued 1,350 of the shares in transaction (b) two months later at $17 cash per share.

1.

Indicating the account, amount, and direction of the effect on above transaction

2.	Prepare journal entries to record each transaction

3.	Prepare the stockholders equity section of the balance sheet at December 31. (Amounts to be deducted should be indicated by a minus sign.)
	TIP: Because this is the first year of operations, Retained Earnings has a zero balance at the beginning of the year.