Homework Help Question & Answers

On May 27, Mama Mia Inc. reacquired 6,700 shares of its common stock at $19 per share. On August ...

On May 27, Mama Mia Inc. reacquired 6,700 shares of its common stock at $19 per share. On August 3, Mama Mia sold 2,800 of thUsing the following accounts and balances, prepare the Stockholders Equity section of the balance sheet using Method 1 of ExI will give thumbs up. please answer all. Numbers and the blue arrows

On May 27, Mama Mia Inc. reacquired 6,700 shares of its common stock at $19 per share. On August 3, Mama Mia sold 2,800 of the reacquired shares at $22 per share November 14, Mama Mia sold the remaining shares at $18 per share. Journalize the transactions of May 27, August 3, and November 14. For a compound transaction, if an amount box does not require an entry, leave it blank. May 27 Aug. 3 Nov. 14
Using the following accounts and balances, prepare the Stockholders' Equity section of the balance sheet using Method 1 of Exhibit 8. 30,000 shares of common stock authorized, and 2,000 shares have been reacquired. Common Stock, $70 par Paid-In Capital from Sale of Treasury Stock Paid-In Capital in Excess of Par-Common Stock Retained Earnings Treasury Stock $1,470,000 29,000 378,000 853,000 13,000 Stockholders' Equity Paid-In Capital Total Paid-in Capital Total Total Stockholders' Equity
0 0
ReportAnswer #1

Solution

Mama Mia

Journal Entries

Date

Account Titles and Explanation

Ref. No.

Debit

Credit

May 27,

Treasury Stock

$127,300

Cash

$127,300

(To record reacquisition of 6,700 shares at $19 each)

Aug 3,

Cash

$61,600

Paid-in Capital in Excess of Par

$8,400

Treasury Stock

$53,200

(To record sale of reacquired shares at $22 each)

Nov 14,

Cash

$70,200

Paid-in Capital in Excess of Par

$3,900

Treasury Stock

$74,100

(To record sale of reacquired shares at $18 each)

Computations:

Cost of reacquired shares on May 27 = 6,700 x $19 = $127,300

Cost of sale of 2,800 reacquired shares on Aug 3, = 2,800 x $19 = $53,200

Sale value = 2,800 x $22 = $61,600

Paid-in Capital in excess of par = 2,800 x (22 -19) = $8,400

Treasury stock = 2,800 x 19 = $52,200

Cost of sale of remaining treasury stock = 6,700 – 2,800 = 3,900 shares

Sale value = 3,900 x $18 = $70,200

Paid-in capital in excess of par (debit)      = $3,900

Cost of shares = 3,900 x $19 = $74,100

Stockholders’ Equity

Stockholders' Equity

Paid-in Capital

Common Stock $70 par, shares authorized 30,000; 21,000 issued and outstanding

$1,470,000

Paid in Capital from sale of treasury stock

$33,500

Paid-in Capital in excess of Par - Common Stock

$378,000

Total paid-in Capital

$1,881,500

Retained Earnings

$853,000

Treasury Stock

($13,000)

Total Stockholders' Equity

$2,721,500

Note:

Paid in capital from sale of treasury stock –

Beg. Balance = $29,000

Add: Excess of sale value over cost for 2,800 treasury shares = $8,400

Less: excess of cost over sale value for 3,900 treasury shares = ($3,900)

Paid in capital from sale of treasury stock, ending balance = $33,500

Add Homework Help Answer
Add Answer of:
On May 27, Mama Mia Inc. reacquired 6,700 shares of its common stock at $19 per share. On August ...
Your Answer: Your Name: What's your source?
Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
More Homework Help Questions Additional questions in this topic.
Need Online Homework Help?
Ask a Question
Get FREE EXPERT Answers
WITHIN MINUTES
Related Questions