Rinehart Corporation purchased from its stockholders 4,900 shares of its own pre

Question

Rinehart Corporation purchased from its stockholders 4,900 shares of its own previously issued stock for $254,800. It later resold 2,000 shares for $55 per share, then 2,000 more shares for $50 per share, and finally 900 shares for $44 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.)

To record purchase form stockholders

To record sales of shares at $55 per share

To record sales of shares at $50 per share

To record sale of shares at $44 per share

Explanation / Answer

Treasury Stock(Dr) $254,800
Cash(Cr) $254,800
(To record purchase of 4,900 shares of stock at $52 per share)

It later resold 2,000 shares for $55 per share

Cash(Dr) $110,000
Treasury Stock(Cr)$104,000
Paid-in Capital from treasury stock(Cr) $6,000
(To record sale of 2,000 shares of Treasury stock for $55 per share)

It later resold 2,000 more shares for $50 per share
Cash(Dr) $100,000
Paid-in Capital from Treasury Stock(Dr) $4,000
Treasury stock(Cr)$104,000
(To record sale of 2,000 shares of Treasury stock for $50 per share)

It finally resold 900 shares for $44 per share.
Cash(Dr) $39,600
Paid-in Capital from Treasury Stock(Dr) $7,200
Treasury stock(Cr) $46,800
(To record sale of 900 shares of Treasury stock for $44 per share)

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