Exercise 11-4 The stockholders\' equity section of Indigo Corporation\'s balance
ID: 2472304 • Letter: E
Question
Exercise 11-4 The stockholders' equity section of Indigo Corporation's balance sheet at December 31 is presented here INDIGO CORPORATION Balance Sheet (partial) Stockholders' equity Paid-in capital Preferred stock, cumulative, 11,833 shares authorized, 7,100 shares issued and outstanding 710,000 1,665,000 2,375,000 1,151,000 3,526,000 37,333 $3,488,667 Common stock, no par, 717,672 shares authorized, 555,000 shares issued Total paid-in capital Retained earnings Total paid-in capital and retained earnings Less: Treasury stock (7,000 common shares) Total stockholders' equity From a review of the stockholders' equity section, answer the following questions (a) How many shares of common stock are outstanding? Common stock outstanding sharesExplanation / Answer
Answer
Answer a)
Common stock of shares outstanding are $ 548000 (555,000 -7000).
Answer b)
The state value of common stock is $ 3 per share (1665000/555000).
Answer c)
The par value of preferred stock is $ 100 per share (710000/7100).
Answer d)
It the annual dividend on preferred stock is $ 49700. The dividend rate on preferred stock is 7.00%
(49700/710000).
Answer e)
If dividends of $ 71,400 were in arrears on preferred stock, the balance reported for retained earnings will be $ 1079600 (1151000 – 71400).
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