Homework Answers
1.
The following journal entries will be prepared for the given transactions:
| Date | Account Titles | Debit | Credit |
| Jul. 1 | Cash | 1500000 | |
| Common Stock | 1250000 | ||
| Paid-in Capital in Excess of Par | 250000 | ||
| Sept. 1 | Cash | 50000 | |
| Common Stock | 25000 | ||
| Paid-in Capital in Excess of Par | 25000 | ||
| Dec. 1 | Treasury Stock | 225000 | |
| Cash | 225000 |
2.
Authorized ordinary shares means the number of shares of common stock a company is authorized to issue. A company cannot issue more than its authorized number of common shares.
Unissued ordinary shares means the number of authorized common shares that the company has not issued yet.
Treasury shares are the shares that were earlier issued by a company and that it buys back from the market.
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