0 Sheilby Corporation was organized in January to operate an The charter issued

Question

0 Sheilby Corporation was organized in January to operate an The charter issued by the state authorized the following capital stock: g sales and service business Common stock, $1 par value, 200,000 shares Preferred stock, $10 par value, 6 peroent, 50,000 shares During January and February, the following stock transactions were completed a. Collected $625,000 cash and issued 25,000 shares of common stock b. Issued 17,500 shares of preferred stock at $35 per share; collected in cash Net income for the year was $55,000, cash dividends declared and paid at yoar-end were $12.000. Required: Prepare the stockholders' equity section of the balance sheet at December 31 SHELBY CORPORATION Balance Sheet (Partial) Stockholders' Equity Contributed Capital Total Contributed Capital Total Stockholders Equity

Explanation / Answer

SHARE HOLDERS EQUITY AMOUNT(IN$'S) CONTRIBUTED CAPITAL: COMMON STOCK(25000*25) 625000 PREFFERED STOCK(17500*35) 612500 TOTAL CONTRIBUTED CAPITAL 1237500 (-)PREMIUM ON COMMON STOCK(25000*24) 600000 (-)PREMIUN ON PREFEERED STOCK(17500*25) 437500 TOTAL STOCK HOLDERS EQUITY 200000

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