Journalizing treasury stock transactions and reporting stockholders\' equity Pio

Question

Journalizing treasury stock transactions and reporting stockholders' equity Pioneer Amusements Corporation had the following stockholders' equity on November 30: On December 30, Pioneer purchased 100 shares of treasury stock at $11 per sha Requirements 1. Journalize the purchase of the treasury stock. 2. Prepare the stockholders' equity section of the balance sheet at December 31, 2016. Assume the balance in retained earnings is unchanged from November 30. 3. How many shares of common stock are outstanding after the purchase of treasury stock?

Explanation / Answer

1) Treasury stock     Debit       1100

     cash                    credit      1100

[being shares repurchased ]

2)

3)Number of shares outstadning = 130 - 100 = 30 shares

Paid in capital common stock 650 Paid in capital in excess of par -common stock 1950 Total paid in capital 2600 Retained earning 52000 Total paid in capital 54600 Less:Treasury stock -1100 stockholders equity 53500

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