Jude Corporation has been authorized to issue 20,000 shares of $100 par value, 1
ID: 2375698 • Letter: J
Question
Jude Corporation has been authorized to issue 20,000 shares of $100 par value, 10%, noncumulative preferred stock and 1,000,000 shares of no-par common stock. The corporation assigned a $2.50 stated value to the common stock. At December 31, 2014, the ledger contained the following balances pertaining to stockholder's equity.
Perferred Stock $120,000
Pain-in Capital in Excess of Par- Preferred Stock 12,000
Common Stock 1,000,000
Paid-in Capital in Excess of Stated Value- Common Stock 1,600,000
Treasury Stock (1,000 common shares) 9,000
Paid-in Capital from Treasury Stock 1,000
Retained Earnings 82,000
The preferred stock was issued for land having a fair value of $132,000. All common stock issued was for cash. In November, 1,500 shares of common stock were purchased for the treasury at a per share of $9. In December, 500 shares of treasury stock were sold for $11 per share. No dividends were declared in 2014.
Prepare the stockholder's equity section at December 31, 2014
Explanation / Answer
JUDE CORPORATION Stockholders%u2019 equity December 31, 2014 Paid-in capital Capital stock 10% Preferred stock, $100 par value, noncumulative, 20,000 shares authorized, 1,200 shares issued and outstanding $120,000 Common stock, no par, $2.50 stated value, 1,000,000 shares authorized, 400,000 shares issued, and 399,000 outstanding 1,000,000 Total capital stock $1,120,000 Additional paid-in capital In excess of par value-preferred stock 12,000 In excess of stated value-common stock 1,600,000 From treasury stock-common 1,000 Total additional paid-in capital 1,613,000 Total paid-in capital 2,733,000 Retained earnings 82,000 Total paid-in capital and retained earnings 2,815,000 Less: Treasury stock (9,000) Total stockholders%u2019 equity $2,806,000
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