Question

Oregon Outfitters issues 1,700 shares of $1 par value common stock at $20 per share. Later in the year, the company decides to purchase 220 shares at a cost of $21 per share. (1) Record the original issue of the 1,700 shares, (2) Record the purchase of 220 shares, and (3) Record the entry if Oregon Outfitters resells the 220 shares of treasury stock at $27 per share. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet Record the original issue of the 1,300 shares.

Answer 1

Answer and Explanation:

The journal entries are given below;

1. Cash Dr, $34,000 (1,700 × $20)    

     To Common Stock $1,700

       To Paid in capital in excess of par-Common Stock $32,300

(Being issue of common stock is recorded)

2.Treasury stock Dr, $4,620 (220 × $21)

       To Cash  $4,620  

(Being repurchase of treasury stock is recorded)  

3. Cash Dr, $5,940   (220 × $27)

     To Treasury stock $4,620 (220 × $21)  

     To Paid in capital-Treasury stock $1,320

(Being reissue of treasury stock is recorded)