When Resisto Systems, Inc., was formed, the company was authorized to issue 5,00

Question

When Resisto Systems, Inc., was formed, the company was authorized to issue 5,000 shares of $100 par value, 8 percent cumulative preferred stock, and 100,000 shares of $2 stated value common stock.




Half of the preferred stock was issued at a price of $103 per share, and 70,000 shares of the common stock were sold for $13 per share. At the end of the current year, Resisto has retained earnings of $382,000.


What is Cum preferred stock?
Common Stock?

Additional Capital
Preferred Stock?
Common stock?

Explanation / Answer

Preferred stock (2,500 * 100) 250,000 Common stock (70,000*2) 140,000 Paid in capital in excess of par-preferred 7,500 (2,500*3) Paid in capital in excess of stated- common 770,000 (70,000*11)

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