ZYX reported:
Common stock outstanding, 1,000 shares (par $20) $20,000
Contributed capital in excess of par 1,000
Retained earnings 50,000
A) ZYX bought 15 shares to be held as treasury stock for cash at $25 per share.
B) Sold 5 of the treasury shares at $27 per share
Required:
1. Give all entries required, assuming the par value method is used:
Par value method:
A)
Treasury stock (15 x $20)............................300
Contributed capital in excess of par (15 x $1)........15
Retained earnings (to balance)..................60
Cash (15 x $25)......................................375
B)
Cash (5 x $27)........................................135
Treasury stock (5 x $20).................100
Contributed capital in excess of par...........35
Cost Method:
A) Treasury stock (15 x $25)........375
Cash (15 x $25).................375
B) Cash (5 x $27)...............135
Treasury stock (5................125
Contributed capital from treasury stock trans................1