Selected Stock Transactions

Diamondback Welding & Fabrication Corporation sells and services pipe welding equipment in Illinois. The following selected accounts appear in the ledger of Diamondback Welding & Fabrication Corporation at the beginning of the current fiscal year:

Preferred $2\%$ Stock, $$80$ par $(100,000$ shares authorized, $60,000$ shares issued$)$ $$4,800,000$

Paid$-$In Capital in Excess of Par$$Preferred Stock $210,000$

Common Stock, $$9$ par $(3,000,000$ shares authorized, $1,750,000$ shares issued$)15,750,000$

Paid$-$In Capital in Excess of Par$$Common Stock $1,400,000$

Retained Earnings $52,840,000$

During the year, the corporation completed a number of transactions affecting the stockholders' equity. They are summarized as follows:

Purchased $87,500$ shares of treasury common for $$8$ per share.

Sold $55,000$ shares of treasury common for $$11$ per share.

Issued $20,000$ shares of preferred $2\%$ stock at $$84.$

Issued $400,000$ shares of common stock at $$13,$ receiving cash.

Sold $18,000$ shares of treasury common for $$7\mathrm{.}50$ per share.

Declared cash dividends of $$1\mathrm{.}60$ per share on preferred stock and $$0\mathrm{.}05$ per share on common stock.

Paid the cash dividends.

Required:

Journalize the entries to record the transactions. If an amount box does not require an entry, leave it blank.

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a$.$ Purchased $87,500$ shares of treasury common for $$8$ per share.

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$($a$)$ At what value should the treasury shares be recorded at par or the price paid?

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b$.$ Sold $55,000$ shares of treasury common for $$11$ per share.

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$($b$)$ Are the treasury shares being resold at a value higher than or lower than the amount that the company paid for the shares?

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c$.$ Issued $20,000$ shares of preferred $2\%$ stock at $$84.$

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$($c$)$ At what value do common and preferred stock accounts have to be recorded?

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d$.$ Issued $400,000$ shares of common stock at $$13,$ receiving cash.

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$($d$)$ At what value do common and preferred stock accounts have to be recorded?

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e$.$ Sold $18,000$ shares of treasury common for $$7\mathrm{.}50$ per share.

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$($e$)$ Are the treasury shares being resold at a value higher than or lower than the amount that the company paid for the shares?

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f$.$ Declared cash dividends of $$1\mathrm{.}60$ per share on preferred stock and $$0\mathrm{.}05$ per share on common stock.

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$($f$)$ Has the amount of shares owned by shareholders changed since the beginning of the year?

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g$.$ Paid the cash dividends.

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