Rinehart Corporation purchased from its stockholders 5,000 shares of its own pre

Question

Rinehart Corporation purchased from its stockholders 5,000 shares of its own previously issued stock for $255,000. It later resold 2,000 shares for $54 per share, then 2,000 more shares for $49 per share, and finally 1,000 shares for $43 per share.
Prepare journal entries for the purchase of the treasury stock and the three sales of treasury stock. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Treasury Stock 255000 Cash 255000 (To record purchase from stockholders.) Cash 108000 Treasury Stock Paid-in Capital from Treas To record sales of shares at $54 per share.) Cash Paid -in Capital rom Treast 98000 Paid-in Capital from Treasury Stock (To record sales of shares at $49 per share.) Treas Cash Paid-in Capital from Treas

Explanation / Answer

Account Title and Explanation Debit Credit Treasury Stock $255,000 Cash $255,000 (To record purchase from stockholders) Cash $108,000 Treasury Stock $102,000 Paid in Capital from Treasury Stock $6,000 (To record sales of shares at $54 per share) Cash $98,000 Paid in Capital from Treasury Stock $4,000 Treasury Stock $102,000 (To record sales of shares at $49 per share) Cash $43,000 Paid in Capital from Treasury Stock $2,000 Retained Earnings $6,000 Treasury Stock $51,000 (To record sale of shares at $43 per share)

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