Power Drive Corporation designs and produces a line of golf equipment and golf a
ID: 2450666 • Letter: P
Question
Power Drive Corporation designs and produces a line of golf equipment and golf apparel. Power Drive has 100.000 shares of common stock outstanding as of the beginning of 2015. Power Drive has the following transactions affecting stockholders' equity in 2015. Power Drive Corporation has the following beginning balances in its stockholders' equity accounts on January 1. 2015: Common Stock. $100,000: Additional Paid-in Capital. $4,900,000: and Retained Earnings. $2,400,000. Net income for the year ended December 31. 2015, is $640,000. Prepare the stockholders' equity section of the balance sheet for Power Drive Corporation as of December 31. 2015. (Amounts to be deducted should be indicated by a minus sign.)Explanation / Answer
POWER DRIVE CORPORATION
BALANCE SHEET
(Stockholders’ Equity Section)
December 31, 2015
Stockholders’ Equity
Amount in $
Common Stock, $1 par value, shares issued-159,000
159,000
Additional Paid-in capital
8,158,500
Retained Earnings
2,769,700
Treasury Stock
-159,300
Total Shareholders’ Equity
10,927,900
Break-up of each item:
Particulars
Amount in $
Common Stock
Balance at beginning of the year
100,000
Stock issued during the year
59,000
Balance at end of the year
159,000
Additional Paid-in capital
Balance at beginning of the year
4,900,000
Stock issued during the year
3,245,000
Reissue of treasury stock in excess of cost
13,500
Balance at end of the year
8,158,500
Retained Earnings
Balance at beginning of the year
2,400,000
Net Income during the year
640,000
Dividends(per share - $1.70)
-270,300
Balance at end of the year
2,769,700
Treasury Stock
Balance at beginning of the year
NIL
Repurchases
-318,600
Reissue
159,300
Balance at end of the year
-159,300
POWER DRIVE CORPORATION
BALANCE SHEET
(Stockholders’ Equity Section)
December 31, 2015
Stockholders’ Equity
Amount in $
Common Stock, $1 par value, shares issued-159,000
159,000
Additional Paid-in capital
8,158,500
Retained Earnings
2,769,700
Treasury Stock
-159,300
Total Shareholders’ Equity
10,927,900
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