Question
National Supplys shareholders equity included the following accounts at December 31, 2020: Shareholders' Equity Common stock, 9 million shares at $1 par $ 9,000,000 Paid-in
National Supplys shareholders equity included the following accounts at December 31, 2020:
Shareholders' Equity | ||
Common stock, 9 million shares at $1 par | $ | 9,000,000 |
Paid-in capitalexcess of par | 81,000,000 | |
Retained earnings | 80,500,000 | |
Required: 1. National Supply reacquired shares of its common stock in two separate transactions and later sold shares. Prepare the entries for each of the transactions under each of two separate assumptions: the shares are (a) retired and (b) accounted for as treasury stock.
February 15, 2021 | Reacquired 240,000 shares at $12 per share. |
February 17, 2022 | Reacquired 240,000 shares at $9.50 per share. |
November 9, 2023 | Sold 155,000 shares at $11 per share (assume FIFO cost). |
Journal entry (requirements):
1. Record the purchase of 240,000 shares at $12 per share on February 15, 2021 that are accounted for as treasury stock.
2. Record the purchase of 240,000 shares at $9.50 per share on February 17, 2022 that are accounted for as treasury stock.
3. Record the sale of 155,000 shares at $11 per share (assume FIFO cost) on November 9, 2023.
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