United Resources Company obtained a charter from the state in January of this ye

Question

United Resources Company obtained a charter from the state in January of this year. The charter authorized 217,000 shares of common stock with a par value of $2. During the year, the company earned $483,000 Also during the year, the following selected transactions occurred in the order given:

a. Sold 82,000 shares of the common stock in an initial public offering at $15 cash per share.

b. Repurchased 20,000 shares of the previously issued shares at $18 cash per share.

c. Resold 11,000 of the shares of the treasury stock at $21 cash per share.

UNITED RESOURCES COMPANY Balance Sheet (Partial) At December 31, This year Stockholders' equity: Contributed capital: Common stock ditional paid-in capital ditional paid-in capital Ad Ad Total contributed capital 0 Retained earningS Total contributed capital and retained earnings Treasury stock Treasury stock Total stockholders' equity 0 0

Explanation / Answer

Balance sheet (partial )

Stockholder's equity contributed capital Common stock 164000 Additional paid in capital 1066000 Paid in capital from sale of treasury stock 33000 Total contributed capital 1263000 Retained earnings 483000 Total contributed capital and retained earnings 1746000 Less : treasury stock (162000) Total stockholder's equity 1584000

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