PA11-3 Finding Missing Amounts LO 11-2, LO 11-3, LO 11-5] At December 31 the rec

Question

PA11-3 Finding Missing Amounts LO 11-2, LO 11-3, LO 11-5] At December 31 the records of Kozmetsky Corporation provided the following selected and data incomplete Common stock (par $2; no changes during the current year). Shares authorized, 5,000,000. Shares issued,? issue price $9 per share. Shares held as treasury stock, 11,900 shares, cost $7 per share. Net income for the current year, $380,900. Common Stock account, $141,000 Dividends declared and paid during the current year, $2 per share. Retained Earnings balance, beginning of year, $710,000. Required: Complete the following: (Round "Earnings per share" to 2 decimal places.) 1. Shares issued Shares outstanding 2. The balance in Additional Paid-in Capital would be 3. Earnings per share is 4. Total dividends paid on common stock during the current year is 5. Treasury stock should be reported in the stockholders' equity section of the balance sheet 6. Assume that the board of directors voted a 2-for-1 stock split. After the stock split, the par in the amount of value per share will be

Explanation / Answer

1. Shares issued = $141,000 / $2 = 70,500 shares

Shares outstanding = 70,500 - 11,900 = 58,600 shares

2. Additional Paid in Capital Balance = ($9-$2) * 70,500 = $493,500

3. Earnings Per Share = $380,900 / 58,600 = $6.5

4. Total Dividend paid = 58,600 * $2 = $117,200

5. Treasury Stock will be reported at = 11,900 * 7 = $83,300

6. The par value after stock spilt 2-1 will be = $2 /2 = $1 par value

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