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Treasury Stock, Cost Method Bush-Caine Company reported the following data on its December 31, 2018, balance sheet: The following transactions were reported by the company during 2019: 1. Reacquired 200 shares of its preferred stock at $57 per share. 2. Reacquired 500 shares of its common stock at $16 per share. 3. Sold 100 shares of preferred treasury stock at $58 per share. 4. Sold 200 shares of common treasury stock at $17 per share. 5. Sold 100 shares of common treasury stock at $9 per share. 6. Retired the shares of common stock remaining in the treasury. The company maintains separate treasury stock accounts and related additional paid-in capital accounts for each class of stock. Required: 1. Prepare the journal entries required to record the treasury stock transactions using the cost method. 2. Assuming the company earned a net income in 2019 of $30.000 and declared and paid dividends of $10,000, prepare the shareholders’ equity section of its balance sheet at December 31, 2019.

BuyFind

Intermediate Accounting: Reporting...

3rd Edition
James M. Wahlen + 2 others
Publisher: Cengage Learning
ISBN: 9781337788281
BuyFind

Intermediate Accounting: Reporting...

3rd Edition
James M. Wahlen + 2 others
Publisher: Cengage Learning
ISBN: 9781337788281

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Chapter
Section
Chapter 15, Problem 16P
Textbook Problem

Treasury Stock, Cost Method Bush-Caine Company reported the following data on its December 31, 2018, balance sheet:

Chapter 15, Problem 16P, Treasury Stock, Cost Method Bush-Caine Company reported the following data on its December 31, 2018,

The following transactions were reported by the company during 2019:

  1. 1. Reacquired 200 shares of its preferred stock at $57 per share.
  2. 2. Reacquired 500 shares of its common stock at $16 per share.
  3. 3. Sold 100 shares of preferred treasury stock at $58 per share.
  4. 4. Sold 200 shares of common treasury stock at $17 per share.
  5. 5. Sold 100 shares of common treasury stock at $9 per share.
  6. 6. Retired the shares of common stock remaining in the treasury.

The company maintains separate treasury stock accounts and related additional paid-in capital accounts for each class of stock.

Required:

  1. 1. Prepare the journal entries required to record the treasury stock transactions using the cost method.
  2. 2. Assuming the company earned a net income in 2019 of $30.000 and declared and paid dividends of $10,000, prepare the shareholders’ equity section of its balance sheet at December 31, 2019.

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Intermediate Accounting: Reporting And Analysis
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