CP11-1 Analyzing Accounting Equation Partial Balance Sheet Involving Stock Issuance, Purchase, and Reissuance Transaction Worldwide Company obtained a charter from the state in January that authorized 200,000 shares of common stock, $10 par value. During the first year, the company earned $38,200 and declared no dividends; the following selected transactions occurred in the order given: a. Issued 60,000 shares of the common stock at $12 cash per share. b. Reacquired 2,000 shares at $15 cash per share from stockholders; the shares are now held in treasury. c. Reissued 1,000 of the shares in transaction (b) two months later at $18 cash per share. Required: Indicate the effect of 2. Prepare journal entries to record each transaction. 3. Prepare the stockholders' equity section of the balance sheet at December 31. TIP: Because this is the first year of operations, Retained Earnings has a zero balance at the beginning of the year.

CP11-1 Analyzing Accounting Equation Partial Balance Sheet Involving Stock Issuance, Purchase, and Reissuance Transaction Worldwide Company obtained a charter from the state in January that authorized 200,000 shares of common stock, $10 par value. During the first year, the company earned $38,200 and declared no dividends; the following selected transactions occurred in the order given: a. Issued 60,000 shares of the common stock at $12 cash per share. b. Reacquired 2,000 shares at $15 cash per share from stockholders; the shares are now held in treasury. c. Reissued 1,000 of the shares in transaction (b) two months later at $18 cash per share. Required: Indicate the effect of 2. Prepare journal entries to record each transaction. 3. Prepare the stockholders' equity section of the balance sheet at December 31. TIP: Because this is the first year of operations, Retained Earnings has a zero balance at the beginning of the year.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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