Chapter 10, Problem 26AE

Accounting for treasury stock (Learning Objectives 6 & 7) 20-25 min.

Mid America, Inc., had the following stockholders' equity on November 30:

Stockholders' Equity
Paid-in Capital:
Common Stock, $2 par, 750,000 shares authorized,
180,000 shares issued and outstanding	$360,000
Paid-in Capital in Excess of Par—Common Total Paid-in Capital	270,000 $630,000
Retained Earnings	310,000
Total Stockholders’ Equity	$940,000

On December15. Mid America, Inc., purchased 10,000 shares of treasury stock at $8 per share.

Requirements

1. 1. Journalize the purchase of the treasury stock.
2. 2. Prepare the stockholders’ equity section of the balance sheet at December 31.