Shelby Corporation was organized in January to operate an air-conditioning sales

Question

Shelby Corporation was organized in January to operate an air-conditioning sales and service business. Common stock, $1 par value, 200,000 shares. Preferred stock, $10 par value, 6 percent, 50,000 shares. During January and February, the following stock transactions were completed: a. Collected $361,000 cash and issued 19,000 shares of common stock. Net income for the year was $49,000; cash dividends declared and paid at year-end were $12,000. Required: Prepare the stockholders' equity section of the balance sheet at December 31. SHELBY CORPORATION Balance Sheet (Partial) At December 31 Stockholders' Equity Contributed Capital: Total Contributed Capital Total Stockholders' Equity

Explanation / Answer

SHELBY CORPORATION

Balance Sheet (Partial)

At December 31

Stockholders’ Equity

Contributed capital:

Preferred stock

$1,45,000

Additional paid-in capital, preferred stock

$2,75,500

Common stock

$19,000

Additional paid-in capital, common stock

$3,42,000

Total contributed capital

$7,81,500

Retained earnings

$37,000

Total stockholders' equity

$8,18,500

Preferred stock = 14500 Shares x $10        = $1,45,000

Additional paid-in capital, preferred stock = 14500 x $19 = $2,75,500

Common stock = 19000 Shares x $1         = $19,000

Additional paid-in capital, common stock = $3,61,000 - $19000 = $3,42,000

Retained earnings = $49000 - $12000        = $37000

Contributed capital:

Preferred stock

$1,45,000

Additional paid-in capital, preferred stock

$2,75,500

Common stock

$19,000

Additional paid-in capital, common stock

$3,42,000

Total contributed capital

$7,81,500

Retained earnings

$37,000

Total stockholders' equity

$8,18,500

Related Questions

Navigate

• Browse (All)
• Browse S
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.