Prepare entries to record the issuance of common, preferred, and Treasury stocks

Question 1:

The following items were shown on the balance sheet of Herman Corporation on December 31, 2008:

Stockholders' Equity

      Paid-In Capital

            Capital Stock

                  Common stock, $5 par value, 360,000 shares

                  authorized; ______ shares issued and ______ outstanding......................    $1,650,000

            Additional paid-in capital

                  In excess of par value................................................................................         165,000

                        Total paid-in capital.............................................................................      1,815,000

      Retained Earnings.................................................................................................         750,000

                  Total paid-in capital and retained earnings...............................................      2,565,000

      Less:  Treasury stock (15,000 shares)....................................................................        (180,000)

                  Total stockholders' equity.........................................................................    $2,385,000

Instructions
Complete the following statements and show your computations.
(a) The number of shares of common stock issued was _______________.
(b) The number of shares of common stock outstanding was ____________.
(c) The sales price of the common stock when issued was $____________.
(d) The cost per share of the treasury stock was $_______________.
(e) The average issue price of the common stock was $______________.

Question 2:

Werner Corporation has the following stockholders' equity accounts on January 1, 2008:

            Common Stock, $10 par value ..............................................    $1,500,000

            Paid-in Capital in Excess of Par............................................         200,000

            Retained Earnings..................................................................         500,000

                  Total Stockholders' Equity..............................................    $2,200,000

The company uses the cost method to account for treasury stock transactions. During 2008, the following treasury stock transactions occurred:
April 1 Purchased 9,000 shares at $16 per share.
August 1 Sold 3,000 shares at $18 per share.
October 1 Sold 3,000 shares at $15 per share.

Instructions
(a) Journalize the treasury stock transactions for 2008.

(b) Prepare the Stockholders' Equity section of the balance sheet for Werner Corporation at December 31, 2008. Assume net income was $110,000 for 2008.