Answer:
Dr Cash $3,300
Cr Treasury share $3,100
Cr Paid in capital Treasury stock $200
Explanation:
When the shares of a company is issued and bought back, it is called Treasury stock, and can be re-issued or cancelled by the company.
At the time of the purchase
Treasury shares = 100 × $31
= $3,100
Dr Treasury stock $3,100
Cr Cash $3,100
At the time of resale
It is to be noted that the difference in the issuance of Treasury stock is to be transferred to the Paid in capital Treasury stock account.
Proceeds = 100 × $33
= $3,300
Paid in capital Treasury stock.
= $3,300 - $3,100
= $200
