The stockholders\' equity account balances of Kay Corporation for 2020 are given

Question

 The stockholders' equity account balances of Kay Corporation for 2020 are given below:                                                           January 1      December 31 Common stock ($12 par, 54,000 shares outstanding) .....   648,000         720,000 Paid-in capital – common stock ........................   540,000         594,000 Treasury stock (10,000 share; $16 cost per share) .....   160,000          36,800 Paid-in capital – treasury stock ......................     5,000            ? Retained earnings .....................................   425,000            ?  During 2020, Kay Corporation entered into the following transactions:  March 23     Re-issued 2,400 of the treasury shares for $13 per share  June 9       Re-issued 3,700 of the treasury shares for $22 per share  August 15    Issued 6,000 shares of previously un-issued common stock  November 2   Re-issued 1,600 of the treasury shares for $14 per share  December 18  Declared and paid a $3.75 dividend per share on the              outstanding shares of common stock  Kay Corporation reported a net income of $293,670 for 2020.  Calculate the dollar amount per share received from the issue of the common stock on August 15.

Explanation / Answer

Answer

Common Stock

Paid In capital Common Stock

01-Jan (A)

$648000

$540000

Dec-18 (B)

$720000

$594000

Addition (B – A)

$72,000

$54,000

Dollar amount per share issued = 126000 / 6000 = $21 per share = Answer

Common Stock

Paid In capital Common Stock

01-Jan (A)

$648000

$540000

Dec-18 (B)

$720000

$594000

Addition (B – A)

$72,000

$54,000

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