Question

Marigold Company had the following stockholders' equity as of January 1, 2017. Common stock, $5 par value, 18,200 shares issued Paid-in capital in excess of par-common stock Retained earnings Total stockholders' equity $91,000 299,000 320,000 $710,000 During 2017, the following transactions occurred. Feb. 1 Mar. 1 Mar. 18 Apr. 22 Marigold repurchased 1,990 shares of treasury stock at a price of $17 per share. 850 shares of treasury stock repurchased above were reissued at $15 per share. 530 shares of treasury stock repurchased above were reissued at $15 per share. 580 shares of treasury stock repurchased above were reissued at $19 per share.

Answer 1

Cash Treasury Stock: It is the stock which is reacquired by the company and has not been retired When the treasury stock is issued above the cost at which the treasury stock is acquired, the difference between the issue price of treasury stock and cost of treasury stock is credited Paid in Capital Treasury Stock and treasury stock is credited at cost price When the treasury stock is issued below the cost at which the treasury stock is acquired, the difference between the issue price and cost of treasury stock is debited Paid in Capital Treasury Stock and treasury stock is credited at cost price Account Title Debit Credit Feb 1 Treasury Stock $33,830 (1990 x $17] $33,830 (To record purchase of treasury stock) Mar 1 $12,750 [850 x $15] Additional Paid-in Capital - Treasury Stock $1,700 [850 x $2] Treasury Stock $14,450 [850 x $17] (To record issue of treasury stock) Mar 18 Cash $7,950 [530 x $15] Additional Paid-in Capital - Treasury Stock $1,060 [530 x $2] Treasury Stock $9,010 [530 x $17] (To record issue of treasury stock) Apr 22 Cash $11,020 [580 x $19] Additional Paid-in Capital - Treasury Stock $1,160 [580 x $2] Treasury Stock $9,860 (580 x $17] (To record issue of treasury stock) Cash Marigold Company Stockholders' Equity As of April 30, 2017 Common Stock. $5 par Value, 18200 shares issued Paid in capital in excess of Par - Common Stock Additional Paid-in Capital - Treasury Stock Total Paid in Capital Retained Earnings $91,000 $2,99,000 $1,600 $3,88,400 $4,46,200 $8,34,600 $510 $8,34,090 Less: Treasury Stock Total Stockholders' Equity