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I HAVE AN ACCOUNTING QUESTION?

California Surf Clothing Company issues 1,700 shares of $5 par value common stock at $25 per share. Later in the year, the company decides to repurchase 140 shares at a cost of $48 per share.

Record the transaction if California Surf reissues the 140 shares of treasury stock at $69 per share.

How would the entry be different if the shares reissue at $35 per share rather than at $69 per share?

1 Answer

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  • Anonymous
    9 years ago
    Favorite Answer

    to record issuance:

    dr. cash $42,500

    cr. ordinary share capital $8,500

    cr. ordinary share premium $34,000

    to record repurchase:

    dr. treasury shares $6,720

    cr. cash $6,720

    to record reissue at $69:

    dr. cash $9,660

    cr. treasury shares $6,720

    cr. share premium for TS $2,880

    to record reissue at $35:

    dr. cash $4,900

    dr. retained earnings $1820

    cr. treasury shares $6,720

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