Chapter 15, Problem 15.5E

Treasury Stock Transactions, Retirement, Disclosure. Using the information provided in E15-5, prepare the journal entries to record the acquisition of the treasury stock assuming that it is immediately retired. Also, prepare the journal entries to record the loss and the dividend transactions as well as the shareholders’ equity section of the balance sheet at the end of the year. Round per share prices to four decimal places.

E15-5. Treasury Stock Transactions, Disclosure. The following shareholders’ equity section was taken from the books of Aubry Corporation at the beginning of the current year:

Common Stock. $10 par value, 1,000,000 shares authorized, 98,950 shares issued and outstanding	$ 989,500
Additional Paid-in Capital in Excess of Par - Common	120,000
Additional Paid-in Capital from Treasury Stock Transactions	0
Retained Earnings	1,545,000

Required

1. a. Prepare the journal entries required to record each of the following events:
   • Aubry acquired 15,000 shares of common stock to be held in the treasury at a cost of $16 per share.
   • Aubry sold 4,800 shares of treasury stock at $19 per share.
   • Aubry sold 7,200 shares of treasury stock at $8 per share.
   • Aubry reported a net loss of $367,540 for the year.
   • The company declared and paid a $2 per share cash dividend at year-end.
2. b. Prepare the shareholders’ equity section at the end of the year.