The stockholders\' equity section of Ahab Corporation at December 31 is as follo

Question

The stockholders' equity section of Ahab Corporation at December 31 is as follows AHAB CORPORATION Balance Sheet (partial) Paid-in capital Preferred stock, cumulative, 10,000 shares authorized, 5,000 shares issued and $300,000 1,200,000 1,500,000 1,858,000 3,358,000 outstanding Common stock, no par, 750,000 shares authorized, 600,000 shares issued Total paid-in capital Retained earnings Total paid-in capital and retained earnings Less: Treasury stock (75,000 common shares) (75,000) Total stockholders' equity $3,283,000 Answer the following questions (a) How many shares of common stock are outstanding? Shares of common stock outstanding (b) Assuming there is a stated value, what is the stated value of the common stock? shares The stated value of the common stock per share

Explanation / Answer

Answer: to the 1st 4 parts:(as per guidelines of chegg)

a) Common shares outstanding = shares issued - Treasury stock = 600,000 - 75,000 = 525,000

b) The stated value of common stock = issued capital/No of shares issued= $1,200,000/600,000 = $2 per share

c) Par value of preferred stock = $300,000/5,000= $60 per share

d) Dividend rate on preferred stock = Preferred dividend/Preferred capital = $30,000/$300,000 = 10%

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