The annual report for Malibu Beachwear reported the following transations affect

Question

The annual report for Malibu Beachwear reported the following transations affecting stockholders' equity 3 of 3 a Purchased $350,400 of common stock now held in treasury b Declared cash dividends in the amount of $260,200 C. Paid the dividends in (b) d Issued 104,000 new shares of $0.10 par value common shares for $2 per share. e Closed the Dividends account 3. Prepare a statement of stockholders' equity, assuming the following opening balances Paid In Capital Earmings Beginning 12,700 S 192000 150,400 Net Incone ?

Explanation / Answer

Statemtent of Shareholders equity:

$10,400

(104,000 x 0.10)

$197,600

(104,000 x (2 - 0.10)

Common stock Addtional paid in capital Retained earnings Treaury Stock Beginning $12,700 `$192,000 $150,000 0 Stock Issuance/purchases

$10,400

(104,000 x 0.10)

$197,600

(104,000 x (2 - 0.10)

$350,000 Net Income $274,000 Dividends: Common ($260,200) Ending $23,100 $389,600 $163,800 $350,000

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