Exercise 10-12 Prepare a statement of stockholders\' equity (LO10-7 Power Drive
ID: 2586959 • Letter: E
Question
Exercise 10-12 Prepare a statement of stockholders' equity (LO10-7 Power Drive Corporation designs and produces a line of golf equipment and golf apparel. Power Drive has 100,000 shares of common stock outstanding as of the beginning of 2018.Power Drive has the following transactions affecting stockholders' equity in 2018. March 1 Issues 53,000 additional shares of $1 par value common stock for $50 per share. May 10 Repurchases 4,800 shares of treasury stock for $53 per share. June 1 Declares a cash dividend of $1.40 per share to all stockholders of record on June 15. (Hint Dividends are not paid on treasury stock.) July 1 Pays the cash dividend deciared on June 1 October 21 Reissues 2,400 shares of treasury stock purchased on May 10 for $58 per share. Power Drive Corporation has the following beginning balances in its stockholders' equity accounts on January 1, 2018: Common Stock, $100,000, Additional Paid-in Capital, $4,300,000, and Retained Earnings, $1,800,000. Net income for the year ended December 31, 2018, is $580,000. Required: Prepare the statement of stockholders equity for Power Drive Corporation for the year ended December 31, 2018. (Amounts to be deducted should be indicated by a minus sign.) POWER DRIVE CORPORATION Statement of Stockholders Equity For the Year Ended December 31, 2018 Total Common Stock Additional Paid- Retained Earnings in Capital Treasury Stock Stockholders Balance, January 1 issued common stock S100.000 S4.300.000 S 1.800 000 $ 0 S 6.200 000 11:10 PM 12/4/2017Explanation / Answer
Dividend : shares outstanding *dividend per share
[ 100000+53000-4800]*1.4
207480
Statement of stockholders equity common stock Additional paid in capital Retained earnings Treasury stock Total stockholders equity Balance,Jan 1 100000 4300000 1800000 0 6200000 Issued common stock 53000 [53000*1] 2597000 [53000*49] 2650000 [53000*50] Purchase treasury stock -254400 [4800*53] -254400 Dividend -207480** -207480 Sale of treasury stock 12000 [2400*(58-53)] 127200 [2400*53] 139200 Net Income 580000 580000 Balance 153000 6909000 2172520 -127200 9107320Related Questions
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