The stockholders\' equity section of Leyland Corporation balance sheet at Decemb

Question

The stockholders' equity section of Leyland Corporation balance sheet at December 31 is presented here.

Leyland Corporation Balance Sheet (partial)

From a review of the stockholders' equity section, answer the following questions.

(a) How many shares of common stock are outstanding?

Common stock outstanding _______ shares

(b) Assuming there is a stated value, what is the stated value of the common stock?

The stated value of the common stock $________ per share.

(c) What is the par value of the preferred stock?

The par value of the preferred stock $________ per share.

(d) If the annual dividend on preferred stock is $60,152, what is the dividend rate on preferred stock?

The dividend rate is ____%

(e) If dividends of $75,500 were in arrears on preferred stock, what would be the balance reported for retained earnings?

The Retained Earnings balance $_______

Stockholders' equity Paid-in capital Preferred stock, cumulative, 12,167 shares authorized, 7,300 shares issued and outstanding $751,900 Common stock, no par, 767,586 shares authorized, 593,600 shares issued 2,968,000 Total paid-in capital 3,719,900 Retained earnings 1,190,600 Total paid-in capital and retained earnings 4,910,500 Less: Treasury stock (5,030 common shares) (26,827) Total stockholders' equity $4,883,673

Explanation / Answer

Solution:

(A). Common Shares Stock:

   Total Common Stock Shares is = 7,67,586

(B). Common Stock Per Share Price:

   Total Amount / No.of Shares

= 29,68,000 / 7,67,586

   = 3.866

(C). Prefered Stock Per Share Value:

      Total Amount / No.of Shares

   = 7,51,900 / 12,167

   = 61.79

(D). Divdend Rate :

   Dividend Rate = (Recient Dividend ) *(Dividend Periods Per Year) + Extra Dividends

OR

Prefered Stock / Dividend Amount

   = 7,51,900 / 60,152

   = 12.5

(E). Reatained Earnings Balance:

   Total Retained Earnings   4,910,500 - 75,500

   = 4,835,000

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