Problem
On October 10, the stockholders' equity of Sherman Systems appears as follows.
Common stock-$10 par value, 90,000 shares authorized, issued, and outstanding $ 900,000
Paid-in capital in excess of par value, common stock 306,000
Retained earnings 1,008,000
Total stockholders' equity $ 2,214,000
I. Prepare journal entries to record the following transactions for Sherman Systems.
a. Purchased 6,800 shares of its own common stock at $43 per share on October 11.
b. Sold 1,450 treasury shares on November 1 for $49 cash per share.
c. Sold all remaining treasury shares on November 25 for $38 cash per share.
1.Record the purchase of 6,800 shares of its own common stock for $43 cash per share.
2.Record the reissue of 1,450 shares of the treasury stock for $49 cash per share.
3.Record the reissue of the remaining shares of the treasury stock for $38 cash per share.
II. Prepare the revised equity section of its balance sheet after the October 11 treasury stock purchase.