Question

1 Finishing Touches has two classes of stock authorized: 7%, $10 par preferred, and $1 par value common. The following transactions affect stockholders' equity during 2021, its first year of operations: 2 Issues 100,000 shares of common stock for $15 per share 6 Issues 1,000 shares of 7% preferred stock for $13 per share. September 10 Purchases 12,000 shares of its own common stock for $20 per share December 15 Resells 6,000 shares of treasury stock at $25 per share. 10 January February points еВook 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.) Hint References View transaction list X Record the issuance of 100,000 shares of common stock for $15 per share. share Record the issuance of 1,000 shares of 7% preferred stock for $13 per share. Record the purchase of 12,000 shares of its own common stock for $20 per share. 3 Credit Record the resale of 6,000 shares. 4

Answer 1

Jan 2	Cash (100,000*15)	1,500,000
	Common stock (100,000*1)		100,000
	Paid in capital in excess of par - common		1,400,000
Feb6	Cash (1000*13)	13,000
	7% preferred stock (1000*10)		10,000
	Paid in capital in excess of par - Preferred		3,000
Sep 10	Treasury stock	240,000
	Cash (12,000*20)		240,000
Dec 15	Cash (6000*25)	150,000
	Treasury stock (6000*20)		120,000
	Paid in capital in excess of par - Treasury		30,000

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