Prepare the journal entry to record sale of treasury shares

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Question - Apple designs, manufactures, and markets mobile communication and media devices, personal computers, and portable digital music players. Apple employs over 80,000 people in the United States. A recent statement of cash flows contained the following information (in millions):


Year 3

Year 2

Year 1

Cash flows from financing activities:




Repurchases of common stock

(45,000)

(22,860)

-0-

Required - Assume that the repurchase of common stock in Year 3 was attributable to 300 million shares of common stock being repurchased at $150 per share. Prepare the journal entry to record the purchase of treasury stock in Year 3.

Assume that in Year 4, Apple resold 25 million shares of the treasury stock that was originally repurchased in Year 3. Assume the firm was able to resell these shares at $175 per share. Prepare the journal entry to record the sale of the treasury shares.

Assume that in Year 5, Apple resold 10 million shares of the treasury stock that was originally repurchased in Year 3. Assume the firm was able to resell these shares at $140 per share. Prepare the journal entry to record the sale of the treasury shares.

Reference no: EM133114251

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