Homework SourseOn January 10 Mood Inc purchased 15000 shares of its own com
On January 10, Mood Inc. purchased 15,000 shares of its own common stock at $17.00 per share. On August 14, a total of 3,000 treasury shares were sold at $20.00 per share. These are the only treasury stock transactions ever made by the corporation. Prepare the journal entries required on January 10 and August 14.
Solution
Date
Account titles and explanation
Debit
Credit
January 10
Treasury stock (15,000 shares*$17)
$ 255,000.00
Cash
$ 255,000.00
(Being shares purchased for cash)
August 14
Cash (3,000 shares*$20)
$ 60,000.00
Treasury stock (3,000 shares * $17)
$ 51,000.00
Additional paid in capital - Treasury stock
$ 9,000.00
(Being treasury stock issued at more than cost)
| Date | Account titles and explanation | Debit | Credit |
| January 10 | Treasury stock (15,000 shares*$17) | $ 255,000.00 | |
| Cash | $ 255,000.00 | ||
| (Being shares purchased for cash) | |||
| August 14 | Cash (3,000 shares*$20) | $ 60,000.00 | |
| Treasury stock (3,000 shares * $17) | $ 51,000.00 | ||
| Additional paid in capital - Treasury stock | $ 9,000.00 | ||
| (Being treasury stock issued at more than cost) |
