1:46 PM moodie.adelphi.edu iPad 20%! ) Site pages My profile On January 1, 2015,

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1:46 PM moodie.adelphi.edu iPad 20%! ) Site pages My profile On January 1, 2015, Adelphi Corp, had the following account balances in its Shareholders' Equity accounts. Common stock, S1 par, 250,000 shares issued Paid-in capital excess of par, common Paid-in capital excess of par, preferred Preferred stock, $100 par, 10,000 shares outstanding Retained earnings Treasury stock, at cost, 5,000 shares 250,000 500,000 100,000 1,000,000 2,000,000 25,000 Administration Edit my submission Course administration My profile settings Preferred stock is non-cumulative, and carries 7% dividend rate. During 2015, Adelphi Corp, had several transactions relating to common stock as shown below. .January 15: Declared a cash dividend of $250,000 to common stockholders after meeting the required 2015 dividend on preferred stock for the year February 17: Paid the above cash dividend to both preferred stock and common stock April 10: Declared and distributed a 10% stock dividend on the outstanding common stock as of that date. The market value per common share was $15. October 18: Declared a $0.70 special cash dividend per share on the outstanding common stock as of that date. Assume net income is $1,000,000 for the year ended 12/31/2015. Required: Calculate the ending balance of Stockholders' equity after the above events have been recorded. Do not provide journal entries in your solution; instead prepare a table as shown below and enter the effect of each of the above transactions in the table under the appropriate columns. If an item decreases the balance of an account, put a negative sign before the amount of the item in the table. The total of each column in the end will help you find the stockholders' equity balance. (12 points) Preferred Additional Common AdditionaRetained Treasury earnings stock at Transactions stock at PIC on Pref stock at PIC one stock Common stock par par cost

Explanation / Answer

Transaction Preferred stock at par Add PIC on preferred Stock Common Stock at par Add PIC on common Stock Retained earnings Treasury stock at cost Amount in $ Jan1 Bal 15-Jan 1000000 100000 250000 500000 2000000 25000 17-Jan -70000 17-Jan -250000 17-Feb No entry as dividend is paid 10-Apr 25000 350000 18-Oct -192500 0.7*(250000+25000) 31-Dec 1000000 Total Dec 31 bal 1000000 100000 275000 850000 2487500 25000 4737500

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