E11-11 The stockholders\' equity section of Haley Corporation at December 31 is
ID: 2581379 • Letter: E
Question
E11-11
The stockholders' equity section of Haley Corporation at December 31 is as follows.
HALEY CORPORATION
Balance Sheet (partial)
Paid-in capital Preferred stock, cumulative, 10,000 shares authorized, 6,000 shares issued and outstanding $300,000 Common stock, no par, 750,000 shares authorized, 600,000 shares issued 1,200,000 Total paid-in capital 1,500,000 Retained earnings 1,858,000 Total paid-in capital and retained earnings 3,358,000 Less: Treasury stock (10,000 common shares) 64,000 Total stockholders' equity $3,294,000
Instructions
From a review of the stockholders' equity section, as chief accountant, write a memo to the president of the company answering the following questions.
(a) How many shares of common stock are outstanding?
(b) Assuming there is a stated value, what is the stated value of the common stock?
(c) What is the par value of the preferred stock?
(d) If the annual dividend on preferred stock is $30,000, what is the dividend rate on preferred stock?
(e) If dividends of $60,000 were in arrears on preferred stock, what would be the balance in Retained Earnings?
Chrome File Edit View History Bookmarks People Window Help 43% C) Mon 7:25 PM N Netflix x.g P11-1A DeLong Corpo/XI- Jane The Virgin Video xO Files x WileyPLUS Rachel x Draitzelxx's Xbox cl X Secure l https://edugenwileyplus.com/edugen/student/mainfr.un. WileyPLUS:MyWilleyPLUsI HelpI Contact UsI Log Out WileyPLUS Weygandt, Financial Accounting, 10e FINANCIAL ACCT. (ACCT298) Chapter 11. Corporations: Organization, StockSelect a Section Select a Study Objective B , STANDARD VIEW PRINTER VERSION BACK NEXT CHAPTER RESOURCES Textb ORION: Build your Proficiency E11-11. Answer questions about stockholders' equity section (LO 2, 4) The stockholders' equity section of Haley Corporation at December 31 is as follows. End of Chapter Homework Material Questions HALEY CORPORATION Balance Sheet (partial) Paid-in capital Preferred stock, cumulative, 10,000 shares authorized, 6,000 shares issued and outstanding Common stock, no par, 750,000 shares authorized, 600.000 shares issued S 300,000 1,200,000 1,500,000 1,858,000 3,358,000 64,000 S3,294,000 untin Total paid-in capital Total paid-in capital and retained carnings Total stockholders' equity Thinking Retained earnings -Solution walkthrou Videos Applied Skills Video Excel Video Less: Treasury stock (10,000 common shares) Flashcards & Ga Instructions COURSE RESOURCES From a review of the stockholders' equity section, as chief accountant, write a memo to the president of the company answering the following questions. (a) (b) (c) (d) (e) How many shares of common stock are outstanding? Assuming there is a stated value, what is the stated value of the common stock? What is the par value of the preferred stock? If the annual dividend on preferred stock is S30,000, what is the dividend rate on preferred stock? If dividends of S60,000 were in arrears on preferred stock, what would be the balance in Retained Earnings? Videos Excel Videos kill ash Crossword PuzzleExplanation / Answer
a) Outstanding shares = Common shares issued - Treasury stock
= 600000 - 10000
= 590000
b) Stated value = Total value / Shares issued
= 1200000 / 600000
= $2.00
c) Par value of preferred stock = Value / Shares issued
= 300000/6000
= $50
d) Preferred dividend = Preferred share capital * dividend rate
Dividend rate = Total value / Dividends
= 300000 / 30000
= 10.00%
e) The retained earnings will not be effected till the time the dividends are declared, the arrears dividends will not effect the Retained earnings, so the retained earnings will remain the same i.e. 1858000
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