Stockholders\' Equity Section of Balance Sheet Specialty Auto Racing Inc. retail

Question

Stockholders' Equity Section of Balance Sheet Specialty Auto Racing Inc. retails racing products for BMWs, Porsches, and Ferraris. The following accounts and their balances appear in the ledger of Specialty Auto Racing Inc. on July 31, the end of the current year: Common Stock, $10 par Paid-In Capital from Sale of Treasury Stock-Common Paid-In Capital in Excess of Par-Common Stock Paid-In Capital in Excess of Par-Preferred Stock Preferred 4% Stock, $50 par Retained Earnings Treasury Stock-Common One hundred thousand shares of preferred and 400,000 shares of common stock are authorized. There are 4,300 shares of common stock held as treasury stock. Prepare the Stockholders Equity section of the balance sheet as of July 31, the end of the current year using Method 1 of Exhibit 8 $760,000 57,300 228,000 76,500 1,275,000 2,924,100 47,300

Explanation / Answer

Ans. Specialty Auto Racing inc. Stockholders' Equity July 31, 20XX Paid In Capital: Amt.($) Amt.($) Preferred 4% Stock, $50 par $     1,275,000 Common Stock, $10 par             760,000 $   2,035,000 Additional Paid in Capital:    Paid in capital in excess of Par-Common Stock $        228,000    Paid in capital in excess of Par-Prefereed Stock               76,500           304,500 Add: Paid in capital from Treasury stock              57,300              Total Paid in capital $   2,396,800 Add: Retained Earnings        2,924,100              Total $   5,320,900 Less: Treasury Common Stock           (47,300) Total Stockholders' Equity $   5,273,600

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