On October 10, the stockholders' equity section of Sherman Systems appears as follows.Common stock-$10 par value, 5,500 shares authorized, issued, and outstandingPaid-in capital in excess of par value, common stockRetained earningsTotal stockholders' equity1. Prepare journal entries to record the following transactions for Sherman Systems.a. Purchased 7,000 shares of its own common stock at $45 per share on October 11.b. Sold 1,500 treasury shares on November 1 for $51 cash per share.c. Sold all remaining treasury shares on November 25 for $44 cash per share.2. Prepare the stockholders' equity section after the October 11 treasury stock purchase.$ 920,000316,0001,024,000$ 2,260,000 Required 1 Required 2Prepare journal entries to record the following transactions for Sherman Systems.a. Purchased 7,000 shares of its own common stock at $45 per share on October 11.b. Sold 1,500 treasury shares on November 1 for $51 cash per share.c. Sold all remaining treasury shares on November 25 for $44 cash per share.View transaction listJournal entry worksheet12Record the purchase of 7,000 shares of its own common stock for $45 cashper share.Transactiona.3Note: Enter debits before credits.General JournalDebitCredit

Answer to Question 1:- Transaction General Journal Debit($) Credit($) a Treasury Stock, Common(7000*45) 3,15,000 Cash 3,15,000 b Cash(1500*51) 76,500 Treasury Stock, Common(1500*45) 67,500 Paid in capital, Treasury Stock 9,000 c Cash((7,000-1,500)*44) 2,42,000 Paid in capital, Treasury Stock 9,000 Retained Earnings 3,500 Treasury Stock, Common(5,500*45) 2,47,500Answer to Question 2:- Balance Sheet (partial) after October 11 treasury stock purchase Particulars Amount Common Stock $10 par 9,20,000 Paid-in capital in excess of par value, common stock 3,16,000 Total contributed capital 12,36,000 Retained earnings 10,24,000 Total 22,60,000 Less:Cost of treasury stock (3,15,000) Total stockholders' equity 19,45,000