California Surf Clothing Company issues 1,000 shares of $1 par value common stock at $18 per share. Later in the year, the company decides to Purchase 100 shares at a cost of $21 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.)

Question

George Miller

Business

27 September, 19:17

California Surf Clothing Company issues 1,000 shares of $1 par value common stock at $18 per share. Later in the year, the company decides to Purchase 100 shares at a cost of $21 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.)

+4

Answers (1)

Know the Answer?

Patricia Scott · Answer 1

Answer and Explanation:

The Journal entry is shown below:-

Treasury stock Dr, $2,100

(100 * $21)

To Cash $2,100

(Being the purchase of treasury stock is recorded)

Therefore for recording the the purchase of treasury stock we simply debited the treasury stock as it decrease the equity and we credited the cash as it is also decreasing.