Question

the data group inc. had the following balances in its equity accounts at dec. 31, 2019
common shares, unlimited shares authorized 240, 000 shares issued and outstanding 5, 280000
retained earnings 500000
during 2020 the following equity transactions occured.
apr 15 repurchased and retired 9800 common shares at $20.40 per share
may 1 repurchased and retired 21,000 common shares at $23.60 per share
a prepare journel entries to account for the transaactions during 2020

Answer 1

Solution:

Journal Entries

Date	Account Titles and Explanation	Debit	Credit
Apr. 15	Common Stock [9800*22]	$              215,600
	Retained Earnings		$               15,680
	Cash [9800*20.40]		$             199,920
	(To record common stock retire)
May. 1	Common Stock [21000*22]	$              462,000
	Retained Earnings	$                 33,600
	Cash [21000*23.60]		$             495,600
	(To record common stock retire)

Notes:

1) Here shares are repurchased and retired immediately, so no needs to recognize treasury stock with separate entry.

2) Par Value of Common Stock = $ 5280000 / 240000 Shares = $ 22 per share