All calculations must be shown to receive full credit. Journal entries must be i

Question

All calculations must be shown to receive full credit. Journal entries must be in proper format.  

Jupiter Co. reported the following information at January 1, 2016:

     Common Stock, $1 par, 100,000 shares authorized, 50,000 shares issued

      and outstanding

          During 2016, the following transactions occurred:

      June 10

Repurchased 1,000 shares of its outstanding common stock for $12 per share.

     July 1

Sold 500 shares of treasury stock for $14 per share.

     Sept. 1

Sold 500 shares of treasury stock for $9.50 per share.

     Required:

     Prepare the journal entries that Meyer needs to record for each of these 2016 transactions.

Madison Co. has issued 50,000 shares of common stock; 48,000 shares are outstanding and 2,000 shares are held as treasury stock. On August 15, 2016, Madison’s board of directors declared a cash dividend of $1.50 per share, payable on September 15, 2016, to stockholders of record on August 31, 2016.

Required:

Prepare any necessary journal entries for August 15, August 31, and September 15.

     Common Stock, $1 par, 100,000 shares authorized, 50,000 shares issued

      and outstanding

Explanation / Answer

Date Accounts Title & Explanation Dr CR Jun-10 Treasury Stock, at cost 12000 cash 12000 Repurchase of 1000 shares at $12 per share Jul-01 cash 7000 Treasury stock 500 Capital in excess of par 6500 Sold 500 shares of treasury stock for $14 per share Sep-01 cash 4750 Treasury stock 500 Capital in excess of par 4250 Sold 500 shares of treasury stock for $9.5 per share Treasury stock may have come from a repurchase or buyback from shareholders, or it may have never been issued to the public in the first place. These shares don't pay dividends, have no voting rights and should not be included in shares outstanding calculations Aug,15, 2016 Retained Earnings 72000 Dividend payable 72000 (Dividend declared for48000 shares @ $ 1.5) Aug, 31, 2016 No Entry Required Sep,15, 2016 Dividend Payable 72000 Cash 72000

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