FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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The following selected transactions occurred for Corner Corporation:
| Feb. 1 | Purchased 400 shares of the company’s own common stock at $20 cash per share; the stock is now held in treasury. |
| July 15 | Issued 100 of the shares purchased on February 1 for $30 cash per share. |
| Sept. 1 | Issued 60 more of the shares purchased on February 1 for $15 cash per share. |
Required:
-
Show the effects of each transaction on the
accounting equation. -
Give the indicated
journal entries for each of the transactions. -
What impact does the purchase of
treasury stock have on dividends paid? -
What impact does the reissuance of treasury stock for an amount higher than the purchase price have on net income?
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