Textbook Problem

Treasury Stock, Cost Method On January 1, Lorain Corporation had 2,000 shares of $5 par common stock authorized and outstanding. These shares were originally issued at a price of $26 per share. In addition, 500 shares of $50 par preferred stock were outstanding. These were issued at a price of $75 per sl1are. During the year, the following stock transactions occurred:

1. 1. March 3: Lorain reacquired 100 shares of its own common stock at a cost of $24 per share.
2. 2. April 27: It sold 25 shares of the common stock acquired on March 3 for $33 per share.
3. 3. July 10: It sold 25 shares of the common stock acquired on March 3 for $22 per share.
4. 4. October 12: It retired the remaining shares acquired on March 3.

Required:

Prepare journal entries to record the treasury stock transactions of Lorain, assuming it uses the cost method.