P11-5 Preparing the Stockholders Equity Section after Selected Transactions LO11
ID: 2424614 • Letter: P
Question
P11-5 Preparing the Stockholders Equity Section after Selected Transactions LO11-1, 11-3
United Resources Company obtained a charter from the state in January 2014, which authorized 207,000 shares of common stock, $1 par value. During the first year, the company earned $489,000 and the following selected transactions occurred in the order given:
Prepare the stockholders’ equity section of the balance sheet at December 31, 2014. (Amounts to be deducted should be indicated with a minus sign.)
United Resources Company obtained a charter from the state in January 2014, which authorized 207,000 shares of common stock, $1 par value. During the first year, the company earned $489,000 and the following selected transactions occurred in the order given:
Explanation / Answer
United Resources Company Stockholder's Equity Section as on Dec. 31, 2014 Particulars Amount Common Stock Authorized Capital ( 207000 Shares @ $1) 207,000 Issued Capital (65000 Shares @ $1) 65,000 Paid in Capital in excess of Par (80000 Shares X $18) 1,440,000 Paid in Capital in excess of Par - Treasury Shares 21,000 (7000 Shares X $3) Retained Profit Net Profit earned During the Year 489,000 Less: Treasury Shares (15000 Shares X $22) (330,000) Shareholders Equity Total 1,685,000
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