I need Accounting help please The stockhoders\' equity section of a balance shee

Question

I need Accounting help please

The stockhoders' equity section of a balance sheet at December 31, 2015, is as folkows: 7% Preferred Stock, $1 par, 10,000 shares authorized, 3,000 shares $3,000 issued Common Stock, $1 par, 150,000 share authorized, 10,000 shares issued Paid-in Capital in Excess of Par: Preferred Stock Common Stock Total Capital Stock Retained Earnings Less: Treasury Stock (1,000 common shares at cost) Total Stockholders' Equity 10,000 9,000 20,000 42,000 150,000 6,000 186,000 A) What was the average issue price of the preferred stock? Per share B) What was the average issue price of the common stock? Per share C) What will be the retained earnings account balance immediately following a 2-for-1 stock split? D) If the company's board of directors declares a cash dvidend consisting of the annual stated dividend rate for preferred stockholders plus $1 per share for common total amount of dividends to be paid and what would be the remaining balance in the retained earnings account immediately following the declaration of this cash dividend? Total dividends: stockholders, what is the Retained earnings:$

Explanation / Answer

A.

Calculate the average issue price of the preferred stock:

= (Number of shares issued * Par value) + Paid in capital / Number of shares issued

= (3,000 * $1) + $9,000 / 3,000

= $4 per share

B.

Calculate the average issue price of the common stock:

= (Number of shares issued * Par value) + Paid in capital / Number of shares issued

= (10,000 * $1) + $20,000 / 10,000

= $3 per share

c)

Calculate the retained earnings account balance immediately following a 2 for 1 stock split:

The balance of retained earnings are $150,000 when a stock splits, the price per share decreases according to the stock ratio and the number of shares outstanding increases. But do not affect retained earnings.

d)

Calculation of the total cash dividend:

Details

Amount

7%, Preferred share holders (3,000 shares @ 0.07)

$          210

Common stock share holders (10,000 shares @ $1)

$    10,000

Total cash dividend paid

$    10,210

Calculation of Retained earnings:

Details

Amount

Retained earnings opening balance

$ 150,000

Less: Dividend issued to preferred and common stock holders

$    10,210

Retained earning closing balance

$ 139,790

Details

Amount

7%, Preferred share holders (3,000 shares @ 0.07)

$          210

Common stock share holders (10,000 shares @ $1)

$    10,000

Total cash dividend paid

$    10,210

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