The following table presents the long-term liabilities and stockholders’ equity
ID: 2822322 • Letter: T
Question
The following table presents the long-term liabilities and stockholders’ equity of Information Control Corp. one year ago:
During the past year, the company issued 10.8 million shares of new stock at a total price of $59.6 million, and issued $35.8 million in new long-term debt. The company generated $10.6 million in net income and paid $2.8 million in dividends.
Prepare the current balance sheet reflecting the changes that occurred at the company during the year. (Do not round intermediate calculations. Enter your answers in dollars, not millions of dollars, e.g., 1,234,567.)
Long-term debt $ 65,800,000 Preferred stock 4,080,000 Common stock ($1 par value) 15,800,000 Capital surplus 45,800,000 Accumulated retained earnings 135,800,000
Explanation / Answer
Control Corp.
Current Balance sheet
Long Term Debt*
$101600000
Shareholder’s Equity
Preferred stock
$4080000
Common stock($1 par value)**
$26600000
Capital surplus***
$94600000
Accumulated Retained Earnings****
$143600000
Total Equity
$268880000
Total Liabilities and Equity
$370480000
Calculations are shown below:
*Long Term debt= Existing debt of $65800000 + New Issued $35800000= $101600000
** Common Stock= Existing $15800000 + New issued $10800000 = $26600000
*** Capital Surplus= Existing $45800000 + ($59600000- $10800000)= $94600000
**** Accumulated Retained Earnings= Existing $135800000 + (10600000- 2800000)= $143600000
Control Corp.
Current Balance sheet
Long Term Debt*
$101600000
Shareholder’s Equity
Preferred stock
$4080000
Common stock($1 par value)**
$26600000
Capital surplus***
$94600000
Accumulated Retained Earnings****
$143600000
Total Equity
$268880000
Total Liabilities and Equity
$370480000
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