E15.7 (LO 2) (Effect of Treasury Stock Transactions on Financials) Joe Dumars Company has outstanding 40,000 shares of $5 par common stock which had been issued at $30 per share. Joe Dumars then entered into the following transactions. 1. Purchased 5,000 treasury shares at $45 per share. 2. Resold 2,000 of the treasury shares at $49 per share. 3. Resold 500 of the treasury shares at $40 per share. Instructions Use the following code to indicate the effect each of the three transactions has on the financial statement categories listed in the table below, assuming Joe Dumars Company uses the cost method (I = Increase; D = Decrease; NE = No effect). %3D %3D Stockholders' Paid-in Retained Net Assets Liabilities Equity Сapital Earnings Income 1 2 %23 3.

E15.7 (LO 2) (Effect of Treasury Stock Transactions on Financials) Joe Dumars Company has outstanding 40,000 shares of $5 par common stock which had been issued at $30 per share. Joe Dumars then entered into the following transactions. 1. Purchased 5,000 treasury shares at $45 per share. 2. Resold 2,000 of the treasury shares at $49 per share. 3. Resold 500 of the treasury shares at $40 per share. Instructions Use the following code to indicate the effect each of the three transactions has on the financial statement categories listed in the table below, assuming Joe Dumars Company uses the cost method (I = Increase; D = Decrease; NE = No effect). %3D %3D Stockholders' Paid-in Retained Net Assets Liabilities Equity Сapital Earnings Income 1 2 %23 3.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Wonder Ltd. has treasury stock transactions in 20X9 as follows: a. Feb. 27 Purchased 140,000 common shares as treasury stock at $6.50 per share. b. March 15 Purchased 64,000 common shares as treasury stock for $5.50 per share. c. April 30 Reissued 100,000 shares of treasury stock for $4.25 per share. d. May 16 Purchased 54,000 common shares as treasury stock for $6.05 per share. e. Nov. 26 Reissued 268,000 shares of treasury stock for $4 per share. At the end of 20X8, Wonder Limited had reported the following in shareholders’ equity: Common shares, no-par value; authorized, unlimited shares; issued, 5,800,000 shares, outstanding, 5,500,000 shares $ 21,117,000 Contributed capital on treasury stock transactions 133,600 Retained earnings 14,840,000 Treasury stock, 300,000 common shares (1,260,000) Required:1. Prepare…
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