Journalising Issue of Shares and Treasury Stock Operations

Common Stock, $10 par value, 250,00 shares authorized

        200,000 shares issued and outstanding-$2,000,000

Additional paid in capital for common stock    -$1,000,000

Retained Earnings                                       - $800,000

During year 2015 the following transaction took place

June2,                 Issued additional 8,000 shares of common stock for $110,000

Oct. 1                Management declared a cash dividend of $1per share to stockholders of October 15, 2015 and will be paid in November 1, 2015

Nov. 1,         The cash dividend is paid

Nov. 10        Samson company purchased 1,000 shares of its own for $20 a share in the market

Dec. 1                Samson sold 600 shares of its treasury stock at $25 per share

Dec. 20        Sold another 400 shares of its treasury stock at $12 per share

Dec 31.        Reported net income of $300,000        

1.Prepare the journal entries to record the above transaction. Make sure to show the date of each transaction in your journal entry.

2. Prepare stockholders’ equity section of the balance sheet as of December 31, 2015

3. Calculate earnings per share at the end of 2015.