The shareholders' equity section of the balance sheet of TNL Systems Inc. included the following accounts at December 31, 2017: Shareholders' Equity Common stock, 350 million shares at $1 par Paid-in capital-excess of par Paid-in capital-share repurchase Retained earnings ($ in millions) $ 350 3,150 1 2,500 Required: 1. During 2018, TNL Systems reacquired shares of its common stock and later sold shares in two separate transactions. Prepare the entries for both the purchase and subsequent resale of the shares assuming the shares are (a) retired and (b) viewed as treasury stock. a. On February 5, 2018, TNL Systems purchased 9 million shares at $12 per share. b. On July 9, 2018, the corporation sold 3 million shares at $14 per share. c. On November 14, 2020, the corporation sold 3 million shares at $9 per share. 2. Prepare the shareholders' equity section of TNL Systems' balance sheet at December 31, 2020, comparing the two approaches. Assume all net income earned in 20182020 was distributed to shareholders as cash dividends. Req 1A Reg 1B Req 2 Prepare the entries for both the purchase and subsequent resale for the above transactions of the shares assuming the shares are retired. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) View transaction list Journal entry worksheet Record the purchase of 9 million shares at $12 per share assuming the shares are retired. Note: Enter debits before credits. Debit Credit Date General Journal February 05, 2018 Common stock Paid-in capital excess of par Paid-in capitalshare repurchase Retained earnings Cash Req 1A Reg 1B Req 2 Prepare the entries for both the purchase and subsequent resale for the above transactions of the shares assuming the shares are retired. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) View transaction list Journal entry worksheet Record the sale of 3 million shares at $14 per share. Note: Enter debits before credits. Date General Journal Debit Credit July 09, 2018 Cash Common stock Paid-in capital excess of par Req 1A Reg 1B Reg 2 Prepare the entries for both the purchase and subsequent resale for the above transactions of the shares assuming the shares are retired. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) View transaction list Journal entry worksheet Record the sale of 3 million shares at $9 per share. Note: Enter debits before credits. Debit Credit Date General Journal November 14, 2020 Cash Common stock Paid-in capital excess of par Req 1A Req 1B Req 2 Prepare the entries for both the purchase and subsequent resale for the above transactions of the shares assuming the shares are viewed as treasury stock. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) View transaction list Journal entry worksheet Record the purchase of 9 million shares at $12 per share assuming the shares are viewed as treasury stock. Note: Enter debits before credits. Date General Journal Debit Credit February 05, 2018 Treasury stock Cash Req 1A Req 1B Reg 2 Prepare the entries for both the purchase and subsequent resale for the above transactions of the shares assuming the shares are viewed as treasury stock. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) View transaction list Journal entry worksheet Record the sale of 3 million shares at $14 per share. Note: Enter debits before credits. Date General Journal Debit Credit July 09, 2018 Cash Treasury stock Paid-in capitalshare repurchase Req 1A Req 1B Reg 2 Prepare the entries for both the purchase and subsequent resale for the above transactions of the shares assuming the shares are viewed as treasury stock. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) View transaction list Journal entry worksheet 1 2 3 Record the sale of 3 million shares at $9 per share. Note: Enter debits before credits. General Journal Debit Credit Date November 14, 2020 Cash Paid-in capitalshare repurchase Retained earnings Treasury stock Req 1A Req 1B Req 2 Prepare the shareholders' equity section of TNL Systems' balance sheet at December 31, 2020, comparing the two approaches. Assume all net income earned in 2018-2020 was distributed to shareholders as cash dividends. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) Shareholder's Equity $ in millions Retirement Treasury stock Paid-in capital: Common stock Paid-in capitalexcess of par Retained earnings Less: Treasury stock Total shareholders' equity $ 0 $ 0 Req 1B Req 2
