The stockholders' equity accounts of Norman Inc. were as follows on January 1, 2023: Common stock, $25
Question:
The stockholders' equity accounts of Norman Inc. were as follows on January 1, 2023:
Common stock, $25 par value; authorized 500,000 shares;
issued and outstanding 225,000 shares
$ 5,625,000
Additional Paid-in Capital in Excess of Par
2,475,000
Retained earnings
4,000,000
Total Stockholders' Equity
$12,100,000
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During 2023 Norman engaged in the following stock transactions:
February 1:
Acquired 12,000 shares of the outstanding common stock at $34 per
share.
April 1:
Sold 2,000 share that were held in the treasury at $40 per share.
May 1:
Sold 6,000 shares that were held in the treasury at $32 per share.
December 31: Retired the 4,000 remaining shares of the treasury stock when the market
price of the common stock was $42 per share.
REQUIRED
Prepare the journal entries to record the transactions described above using
(1) the cost method and (2) the par value method.
Feb. 1
April 1
May 1
December 31
Management Accounting
ISBN: 9780730369387
4th Edition
Authors: Leslie G. Eldenburg, Albie Brooks, Judy Oliver, Gillian Vesty, Rodney Dormer, Vijaya Murthy, Nick Pawsey