Clemson Company had the following stockholders’ equity as of January 1, 2020.Common stock, $5 par value, 20,000 shares issued$100,000Paid-in capital in excess of par—common stock300,000Retained earnings$320,00000Total stockholders’ equity$720,000During 2020, the following transactions occurred.Feb.1000Clemson repurchased 2,000 shares of treasury stock at a price of $19 per share.Mar.1800 shares of treasury stock repurchased above were reissued at $17 per share.Mar.18500 shares of treasury stock repurchased above were reissued at $14 per share.Apr.22600 shares of treasury stock repurchased above were reissued at $20 per share.Instructionsa.    Prepare the journal entries to record the treasury stock transactions in 2020, assuming Clemson uses the cost method.b.    Prepare the stockholders’ equity section as of April 30, 2020. Net income for the first 4 months of 2020 was $130,000.

Question
Asked Mar 17, 2020
31 views

Clemson Company had the following stockholders’ equity as of January 1, 2020.

Common stock, $5 par value, 20,000 shares issued
$100,000
Paid-in capital in excess of par—common stock
300,000
Retained earnings
$320,000
00Total stockholders’ equity
$720,000

During 2020, the following transactions occurred.

Feb.
1
000 Clemson repurchased 2,000 shares of treasury stock at a price of $19 per share.
Mar.
1
800 shares of treasury stock repurchased above were reissued at $17 per share.
Mar.
18
500 shares of treasury stock repurchased above were reissued at $14 per share.
Apr.
22
600 shares of treasury stock repurchased above were reissued at $20 per share.

Instructions

a.    Prepare the journal entries to record the treasury stock transactions in 2020, assuming Clemson uses the cost method.

b.    Prepare the stockholders’ equity section as of April 30, 2020. Net income for the first 4 months of 2020 was $130,000.

check_circle

Expert Answer

Journal Entries

Journal Entries

Accounting homework question answer, step 1, image 1

...

Want to see the full answer?

See Solution

Check out a sample Q&A here.

Want to see this answer and more?

Solutions are written by subject experts who are available 24/7. Questions are typically answered within 1 hour.*

See Solution
*Response times may vary by subject and question.

Related Accounting Q&A

Find answers to questions asked by student like you
Show more Q&A
add
question_answer

Q: What features or rights may alter the character of preferred stock?

A: Preferred stock is the stock which gets preferential rights to payment of  dividends and in case of ...

question_answer

Q: Matty Kim, an accountant for Vernitron, earned $120,900 from January to June. Matty earned $20,000. ...

A:    

question_answer

Q: The stockholders’ equity accounts of G.K. Chesterton Company have the following balances on December...

A:  

question_answer

Q: On June 30, 2012, County Company issued 12% bonds with a par value of $800,000 due in 20 years. They...

A: Bonds:   Bonds are long-term promissory notes that are represented by a company while borrowing mon...

question_answer

Q: When is the stated interest rate of a debt instrument presumed to be fair?

A: Bond: A bond is a debt instrument, which is repaid along with a specific rate of interest on maturit...

question_answer

Q: How does a merger allow a firm to circumvent tax laws?  a By offering the firm a chance to...

A: A merger is a voluntary fusion, in which two or more companies combine to work as a new legal entity...

question_answer

Q: Explain each of the following terms: authorized ordinary shares, unissued ordinary shares, issued or...

A: Authorized ordinary shares refer to the total maximum number of shares that are legally allowed to i...

question_answer

Q: Break-Even Sales Suntory Holdings Limited is a Japanese beverage maker that produces alcoholic and n...

A: Calculate the total variable cost per unit. Calculate the total fixed cost per unit. Calculate the...

question_answer

Q: EXERCISE 4: TYPES OF RISKS There are three types of risk-related financing options: business risk, f...

A: Risk: It is a situation where the actual results may be less than the expected results. Risks can ca...