Question

Finishing Touches has two classes of stock authorized: 8%, $10 par preferred, and $1 par value common. The following transactions affect stockholders' equity during 2021, its first year of operations: January 2 Issues 100,000 shares of common stock for $34 per share. February 6 Issues 2,900 shares of 8% preferred stock for $12 per share. September 10 Purchases 10,000 shares of its own common stock for $39 per share. December 15 Resells 5,000 shares of treasury stock at $44 per share. Required: Record each of these transactions. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet 2 3 4 Record the issuance of 100,000 shares of common stock for $34 per share. Note: Enter debits before credits. General Journal Debit Credit Date January 02, 2021

Answer 1

1.

Date	General Journal	Debit	Credit
January 2	Cash (100,000*$34)	$3,400,000
	Common stock (100,000*$1)		$100,000
	Additional paid in capital - Common stock (100,000*$33)		$3,300,000

2.

Date	General Journal	Debit	Credit
February 6	Cash (2,900*$12)	$34,800
	Preferred stock (2,900*$10)		$29,000
	Additional paid in capital - Preferred stock (2,900*$2)		$5,800

3.

Date	General Journal	Debit	Credit
September 10	Treasury stock (10,000*$39)	$390,000
	Cash		$390,000

4.

Date	General Journal	Debit	Credit
December 15	Cash (5,000*$44)	$220,000
	Treasury stock (5,000*$39)		$195,000
	Additional paid in capital - Treasury stock (5,000*$5)		$25,000