No id doiak Preferred stock: 8 percent, par $10, authorized 20,000 shares. Commo
ID: 2575701 • Letter: N
Question
No id doiak Preferred stock: 8 percent, par $10, authorized 20,000 shares. Common stock: par $1, authorized 50,000 shares. The following transactions occurred during the first year of operations in the order given: a. Issued a total of 37,000 shares of the common stock for $18 per share. b. Issued 11,000 shares of the preferred stock at $19 per share. c. Issued 2,700 shares of the common stock at $23 per share and 1,100 shares of the preferred stock at $19. d. Net income for the first year was $45,000. Required: Prepare the stockholders' equity section of the balance sheet at December 31. NORTH WIND AVIATION Balance Sheet (Partial) At December 31 Stockholders' Equity Contributed Capital Total Contributed Capital Total Stockholders' EquityExplanation / Answer
Answer:
Already authorized capital:
Common Stock value : 50000 shares at $1 : total $50000
Preffered stock value : 20000 shares at $10 per share : values at $200000
Effect of the operations occured during the first year
Capital that has been issued:
Common stock 37000 shares at par value $1 , valued at 1*37000 = $37000
Common stock again 2700 * $1 = $2700
Preffered stock at par $10 , 11000 *$10 = 110000
Preffered stock again at par value is 1100 * $10 = 11000
Total issued capital : $160700
Additonal paid in capital
Common stock : premium earned :37000*$17 =629000
Again common stock : premium earned : 2700*$22 =59400
Preffered stock premium earned : 11000*$9 =99000
Second issusance of preffered stock : 1100*$9 =9900
Total additional paid in capital : $797300
Net income : $45000
Total shareholders equity : issued capital + additional paid in capital + net income
Total share holders Equity = $1003000
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