On October 10, the stockholders' equity of Sherman Systems appears as follows Common stock$10 par value, 72,000 shares authorized, issued, and

On October 10, the stockholders' equity of Sherman Systems appears as follows

Common stock—$10 par value, 72,000 shares authorized, issued, and outstanding

$720,000

Paid-in capital in excess of par value, common stock

216,000

Retained earnings

864,000

Total stockholders' equity

$1,800,000

Requirement 1:

Prepare journal entries to record the following transactions for Sherman Systems. (Omit the "$" sign in your response.)

a.

Purchased 5,000 shares of its own common stock at $25 per share on October 11.

Date

General Journal

Debit

Credit

Oct. 11

Treasury Stock, Common ..........................................125,000

Cash.....................................................................................125,000

b.

Sold 1,000 treasury shares on November 1 for $31 cash per share.

Date

General Journal

Debit

Credit

Nov. 1

Cash......................................................................31,000

Treasury Stock, Common...................................................25,000

Paid in Capital, Treasury Stock ............................................6,000

c.

Sold all remaining treasury shares on November 25 for $20 cash per share.

Date

General Journal

Debit

Credit

Nov. 25

Cash.........................................................80,000

Paid in Capital, Treasury Stock................6,000

Retained Earnings....................................14,000

Treasury Stock Common..............................................100,000

Requirement 2:

Prepare the revised equity section of its balance sheet as on October 11. (Omit the "$" sign in your response.)

Common stock

720,000

____________

Paid-in capital

____________

Total Paid-in capital

____________

Retained earnings

864,000

____________

Total

____________

__less________ Cost of treasury stock

___( 125,000)_______

Total stockholders' equity