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Sprinkle Inc. has outstanding 10,000 shares of $10 par value common stock. On July 1, 2017, Sprinkle reacquired 100 shares at $87 per share. On September 1, Sprinkle reissued 60 shares at $90 per share. On November 1, Sprinkle reissued 40 shares at $83 per share. Prepare Sprinkles journal entries to record these transactions using the cost method.

7/1/17

Treasury Stock (100 X $87)........................... 8,700

Cash......................................................... 8,700

9/1/17

Cash (60 X $90)............................................... 5,400

Treasury Stock (60 X $87)..................... 5,220

Paid-in Capital from

Treasury Stock.................................... 180

11/1/17

Cash (40 X $83)............................................... 3,320

Paid-in Capital from Treasury Stock........... 160

Treasury Stock (40 X $87)..................... 3,480

Arantxa Corporation has outstanding 20,000 shares of $5 par value common stock. On August 1, 2017, Arantxa reacquired 200 shares at $80 per share. On November 1, Arantxa reissued the 200 shares at $70 per share. Arantxa had no previous treasury stock transactions. Prepare Arantxas journal entries to record these transactions using the cost method.

8/1/17

Treasury Stock (200 X $80)........................... 16,000

Cash......................................................... 16,000

11/1/17

Cash (200 X $70)............................................ 14,000

Retained Earnings......................................... 2,000

Treasury Stock....................................... 16,000

Why this two question use same way to solve, but the one record as Paid-in Capital from Treasury Stock, the other one record as Retained Earnings.

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