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 1,625 shares for $55 per share, then 1,625 more shares for $50 per share, and finally 1,650 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.)

Explanation / Answer

No. Account Titles Debit Credit 1 Treasury Stock $254,800 Cash ($254,800 / 4,900 = $52) $254,800 2 Cash (1,625 x $55) $89,375 Treasury Stock (1,625 x $52) $84,500 Paid-in Capital from Treasury Stock $4,875 3 Cash (1,625 x $50) $81,250 Paid-in Capital from Treasury Stock $3,250   Treasury Stock (1,625 x $52) $84,500 4 Cash (1,650 x $44) $72,600 Paid-in Capital from Treasury Stock $13,200   Treasury Stock (1,650 x $52) $85,800

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