Finishing Touches has two classes of stock authorized: 796, $10 par preferred, a

Question

Finishing Touches has two classes of stock authorized: 796, $10 par preferred, and $1 par value common. The following transactions affect stockholders' equity during 2018, its first year of operations: January 2 Issues 100,000 shares of common stock for $24 per share. February 6 Issues 1,900 shares of 7% preferred stock for $13 per share. September 10 Repurchases 12,000 shares of its own common stock for $29 per share. December 15 Reissues 6,000 shares of treasury stock at $34 per share. In its first year of operations, Finishing Touches has net income of $149,000 and pays dividends at the end of the year of $94,000 ($1 per share) on all common shares outstanding and $1,330 on all preferred shares outstanding. Required: Prepare the stockholders' equity section of the balance sheet for Finishing Touches as of December 31, 2018. (Amounts to be deducted should be indicated by a minus sign.) FINISHING TOUCHES Balance Sheet Stockholders' Equity Section) December 31, 2018 Stockholders' equity: Total paid-in capital Total stockholders' equity

Explanation / Answer

Finishing Touches Balance sheet partial Dec 31,2016 Stockholders equity Preferred Stock              19,000 Common Stock           1,00,000 Additional Paid in Capital        23,05,700 Total paid in Capital        24,24,700 Less: Treasurey Stock         -1,44,000 Retained Earning              53,670 Total Shareholders Equity        23,34,370 Working Note Equity no of shares Issue price Par value Paid in excess Ret. Eaning Jan 2 Issue of shares 100000 24 100000 2300000 Repurchases sept 10 Repurchase -12000 29 -12000 -276000 -60000 Dec-15 Reissue 6000 34 6000 138000 60000 Treasurey stock -6000 -6000 -138000 0 Pref shares no of shares Issue price Par value Paid in excess Feb 6 Issue of shares 1900 13 19000 5700 Feb-06 Net Income 149000 Less; Dividend -94000 Less: Pref. Dividend -1330 Retained Earning 53670

Related Questions

Navigate

• Browse (All)
• Browse F
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.