1. What is the amount of capital in excess of par? 2. What was the amount of ret
ID: 2455996 • Letter: 1
Question
1. What is the amount of capital in excess of par?
2. What was the amount of retained earnings at the beginning of the year?
3. How many shares are in treasury stock?
4. Compute earnings per share
The oloweng mtormatot ons daple beow The financial statements for Highland Publications Corporation included the following selected information questions displayed below Common stock Retained earnings Net income Shares issued Shares outstanding Dividends declared and paid $1,545,000 $ 810,000 1,050,000 103,000 72,000 $650,000 The common stock was sold at a price of $25 per share.Explanation / Answer
1.The amount of Capital in excess of par =
Common Stock Capital = Face Value Per Share* Number of Shares Issued
$1,545,000= Face Value Per Share/ 103,000
Therefore, Face Value Per Share = $ 15
Common Stock was sold for $25 per share(given)
Hence, Amount of Capital in excess of par = $(25-15) * Number of shares issued
= $ 10 *103,000
= $ 1,030,000
2. Amount of retained earnings at the beginning of the year:
Opening Balance of Retained Earnings + Net Income - Dividend Paid = Closing Balance of Retained Earnings
Opening Balance of Retained Earnings +$ 1,050,000 -$ 650,000 = $ 810,000
or Opening Balance of Retained Earnings = $410,000
3. Number of Shares in treasury stock =
Treasury Shares are those which were once a part of the shares outstanding but were subsequently repurchased by the company.
Shares Issued = 103,000
Shares Outstanding = 72,000
Treasury Shares = Shares Issued- Shares Outstanding
= 31,000 Shares
4. Earnings Per Share = Net Income / Shares Outstanding
= $1,050,000/72,000
= 14.58
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.