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1-78 Prepare stockholders\' equity section compute book value per share he follo

ID: 2553542 • Letter: 1

Question

1-78 Prepare stockholders' equity section compute book value per share he following stockholders' equity accounts arranged alphabetically are in the ledger of Crivello orporation at December 31, 2019. Common Stock ($3 stated value Paid-in Capital from Treasury Stock Paid-in Capital in Excess of Par-Preferred Stock Paid-in Capital in Excess of Stated Value-common Stock Preferred Stock (8%, $50 par, noncumulative) Retained Earnings Treasury Stock (8,000 common shares) $2,400,000 10,000 220,000 1,600,000 800,000 1,448,000 75,000 Instructions (a) Prepare a stockholders equity section at December 31. 2018 NOTE: Enter either a number or a formula in the yellow cells. ue per share of the common stock, assuming the preferred stock has a call price of $60 per share CRIVELLO CORPORATION Stockholders' equity Paid-in capital

Explanation / Answer

Crivello Corporation

Stockholders' Equity as on December 31, 2018

Paid-in Capital:

Capital Stock

8% Preferred stock, $50 par, non-cumulative, 16,000 shares issued

$800,000

Common Stock, no par, $3 stated value, 800,000 shares issued and 790,000 outstanding

$2,400,000

Total Capital Stock

$3,200,000

Additional Paid-in Capital:

In excess par Preferred Stock

$220,000

In excess of stated value, Common Stock

$1,600,000

From Treasury Stock

$10,000

Total additional paid-in capital

$1,830,000

Retained Earnings

$1,448,000

Total paid-in capital and retained earnings

$3,278,000

Less: Treasury Stock (10,000 common shares)

($75,000)

Total Stockholders' Equity

$6,403,000

Total Equity

$6,403,000

Less: Preferred stock equity, Call price (16,000 x $60)

($960,000)

Common Stock Equity

$5,443,000

Common shares outstanding

790,000

Book value per share

$6.89 per share

(5,443,000/790,000 = $6.89)

Note: Since the preference shares are non-cumulative, no dividends are considered for preferred share equity.

Crivello Corporation

Stockholders' Equity as on December 31, 2018

Paid-in Capital:

Capital Stock

8% Preferred stock, $50 par, non-cumulative, 16,000 shares issued

$800,000

Common Stock, no par, $3 stated value, 800,000 shares issued and 790,000 outstanding

$2,400,000

Total Capital Stock

$3,200,000

Additional Paid-in Capital:

In excess par Preferred Stock

$220,000

In excess of stated value, Common Stock

$1,600,000

From Treasury Stock

$10,000

Total additional paid-in capital

$1,830,000

Retained Earnings

$1,448,000

Total paid-in capital and retained earnings

$3,278,000

Less: Treasury Stock (10,000 common shares)

($75,000)

Total Stockholders' Equity

$6,403,000