Journal Entires! (Asked before but didn\'t get right answer) Saturn Marine obtai

Question

Journal Entires! (Asked before but didn't get right answer) Saturn Marine obtained a charter from the state in January that authorized 1,000,000 shares of common stock, $5 par value. During the first year, the company earned $410,000 of net income and the following selected transactions occurred in the order given:

1) Write the following journal entries!

A) Record the issuance of 110,000 shares of common stock with a $5 par value for a price of $56 per share.

B) Record the purchase of 26,000 shares of previously issued common stock for a price of $51 per share.

C) Record the re-issuance of 10,500 shares of treasury stock previously purchased for a price of $51 per share and sold for $52 per share.

D) Record the re-issuance of 10,500 shares of treasury stock previously purchased for $51 per share and sold for $50 per share.

a. Issued 110,000 shares of the common stock at $56 cash per share. b. Reacquired 26,000 shares at $51 cash per share. c. Reissued 10,500 shares from treasury for $52 per share. d. Reissued 10,500 shares from treasury for $50 per share.

Explanation / Answer

Transaction no. Account Titles Debit Credit $ $ a. Cash 6,160,000 Common stock 550,000 Paid-in capital in excess of par, common stock 5,610,000 b. Treasury stock 1,326,000 Cash 1,326,000 c. Cash 546,000 Treasury stock 535,500 Paid-in capital in excess- treasury stock 10,500 d. Cash 525,000 Paid-in capital in excess-treasury stock 10,500 Treasury stock 535,500

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