On April 1, 2009, Jetter Corporation reacquired 2,000 shares of its own $10 par share for $120,000 cash. On October 15, 2009, 600 of the treasury shares were reissued at a price of $65 per share.

-Refer to the above data. The journal entry to record the reissuance of the 600 shares on October 15 includes a:

Question

On April 1, 2009, Jetter Corporation reacquired 2,000 shares of its own $10 par share for $120,000 cash. On October 15, 2009, 600 of the treasury shares were reissued at a price of $65 per share.

-Refer to the above data. The journal entry to record the reissuance of the 600 shares on October 15 includes a:

Quizplus · Accepted Answer

When treasury shares are reissued, the cost of the shares (treasury share account) is debited and the amount received from the reissuance is credited to the same amount as the original issue price. Since the original issue price of the shares was $9 per share, the credit will be split between Ordinary Share and Share Premium: Treasury Share Transactions accounts. The credit to Ordinary Share would be $6,000 (600 shares x $10 per share) and the credit to Share Premium: Treasury Share Transactions would be $3,000 ($9 per share - $6 per share cost = $3 per share x 600 shares).

On April 1, 2009, Jetter Corporation Reacquired 2,000 Shares of Its