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On January 1 Alfa Corp. issues 1,000 no-par ordinary shares for 15 per share. The shares have a stated value of 5 per share. When Alfa prepares the journal entry to record the issuance of the shares which of the following will be the correct journal entry?

A. Debit Share PremiumOrdinary 10,000; Debit Share CapitalOrdinary 5,000; Credit Cash 15,000

b. Debit Share PremiumOrdinary 15,000. Credit Share CapitalOrdinary 10,000; Credit Cash 5,000

C. Debit Cash 15,000; Credit Share Capital-Ordinary 5,000; Credit Share PremiumOrdinary 10,000

d. Debit Share PremiumOrdinary 10,000; Debit Cash 5,000; Credit Share CapitalOrdinary 15,000.

On September 1, 2020, Sanchez Company reacquired 12,000 shares of its 10 par value ordinary shares for 15 per share. Sanchez uses the cost method to account for treasury shares. The journal entry to record the reacquisition of the shares should be:

a. Debit to Cash for 180,000; Credit to Treasury Shares for 180,000 b. Debit Share CapitalOrdinary for 120,000; Credit to Treasury Shares for 120,000. c. Debit to Treasury Shares for 180,000; Credit to Cash 180,000 d. Debit to Treasury Shares for 120,000; Credit to Cash for 120,000. e. Debit to Share CapitalOrdinary for 120,000; debit to Share PremiumOrdinary for 60,000; Credit to Treasury Shares for 60,000.

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