When Resisto Systems, Inc., was formed, the company was authorized to issue 5,00
ID: 2447077 • Letter: W
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 $104 per share, and 78,000 shares of the common stock were sold for $19 per share. At the end of the current year, Resisto has retained earnings of $382,000.
Prepare the stockholders’ equity section of the company’s balance sheet at the end of the current year.
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 $104 per share, and 78,000 shares of the common stock were sold for $19 per share. At the end of the current year, Resisto has retained earnings of $382,000.
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 $104 per share, and 78,000 shares of the common stock were sold for $19 per share. At the end of the current year, Resisto has retained earnings of $382,000 a. Prepare the stockholders' equity section of the company's balance sheet at the end of the current year Stockholders' Equity Cumulative preferred stock Common stock Additional paid-in capital: Total paid-in capital 0 Total stockholders' equity $ 0Explanation / Answer
Working:
(A)
Total Preferred Stock= 5,000
Half of the preferred stock=5000*50%= 2,500
Issue Price =104
Total Proceeds= 2,500*104= $ 260,000
(B)
No. of common stock= 78,000
Issue Price = 19
Total Proceeds= 78,000*19=1,482,000
Stockholder's Equity Amount in $ Cumulative Preferred Stock (A) 260,000 Common Stock (B) 1,482,000 Additional Paid in capital: Retained earning 382,000 Total Paid in Capital (C) 382,000 Total Stockholder's equity (A)+ (B)+(C) 2,124,000Related Questions
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