California Surf Clothing Company issues 1,000 shares of $1 par value common stock at $35 per share. Later in the year, the company decides to purchase 100 shares at a cost of $38 per share. Record the purchase of treasury stock. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)

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nicof2010 nicof2010 · Answer 1 · 2020-07-01T03:21:55+02:00

Answer:

The journal entry to record the purchase of treasury stock would be:

Debit ($) Credit ($)

Treasury Stock 3,800

Cash 3,800

Explanation:

In order to prepare The journal entry to record the purchase of treasury stock we would have to calculate the treasury stock as follows:

Treasury Stock=shares purchased*cost per share

Treasury Stock=100 Shares x $38.00 per share

Treasury Stock=$3,800

Therefore, The journal entry to record the purchase of treasury stock would be:

Debit ($) Credit ($)

Treasury Stock 3,800

Cash 3,800

Tundexi Tundexi · Answer 2 · 2021-11-23T14:25:04+01:00

The journal entry will include a debit of $3,800 to Treasury stock and Credit of $3,800 to cash.

Given Information

The company purchase 100 shares at a cost of $38 per share.

Treasury Stock = Shares purchased * Cost per share

Treasury Stock = 100 Shares * $38.00 per share

Treasury Stock = $3,800

The Journal entry will includes as below:

Date Particulars Debit Credit

Treasury Stock $3,800

Cash $3,800

Therefore, the journal entry will include a debit of $3,800 to Treasury stock and Credit of $3,800 to cash.

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