Sagan Co. had these transactions during the current period.

June 12 Issued 80,000 shares of $1 par value common stock for cash of $300,000.

July 11 Issued 3,000 shares of $100 par value preferred stock for cash at $106 per share.

Nov. 28 Purchased 2,000 shares of treasury stock for $9,000.

Prepare the journal entries.

The journal entries are shown below:

Explanation:

The journal entries are as follows

On June 12

Cash $300,000

To Paid-In Capital in Excess of Par - Common Stock $220,000

To Common Stock $80,000 (80,000 shares * $1)

(Being the issuance of the common stock is issued and the remaining balance is credited to the paid in capital)

On July 11

Cash $318,000 (3,000 shares * $106)

To Preferred Stock $300,000 (3,000 shares * $100)

To Paid-In Capital in Excess of Par - Preferred Stock $18,000

(Being the issuance of the preferred stock is issued and the remaining balance is credited to the paid in capital)

On Nov 28

Treasury Stock $9,000

To Cash $9,000

(Being the treasury stock is purchased)