The following is a summary of all relevant transactions of Grouper Corporation s
ID: 340981 • Letter: T
Question
The following is a summary of all relevant transactions of Grouper Corporation since it was organized in 2017.
In 2017, 15,800 shares were authorized and 7,200 shares of common stock ($50 par value) were issued at a price of $57. In 2018, 1,000 shares were issued as a stock dividend when the stock was selling for $60. 300 shares of common stock were bought in 2019 at a cost of $64 per share. These 300 shares are still in the company treasury.
In 2018, 9,300 preferred shares were authorized and the company issued 4,600 of them ($100 par value) at $117. Some of the preferred stock was reacquired by the company and later reissued for $4,310 more than it cost the company.
The corporation has earned a total of $632,300 in net income after income taxes and paid out a total of $288,300 in cash dividends since incorporation.
Prepare the stockholders’ equity section of the balance sheet in proper form for Grouper Corporation as of December 31, 2019. Account for treasury stock using the cost method.
Explanation / Answer
Solution :
Stockholder Equity Section of Balance sheet Grouper Corporation at December 31, 2019 Particulars Amount Stockholders Equity: Common Stock, $50 Par value, 15800 shares authorized, 8200 shares issued and outstanding (7200+1000)*$50 $410,000.00 Preferred Stock, $100 Par value, 9300 shares authorized, 4600 shares issued and outstanding 4600*$100 $460,000.00 Paid in Capital in Excess of Par - Common Stock (7200*$7)+(1000*$10) $60,400.00 Paid in Capital in Excess of Par - Preferred Stock (4600*$17) + $4310 $82,510.00 Treasury Stock 300*$64 $19,200.00 Retained Earnings (Net Income - Cash dividend - Stock Dividend) ($632,300 - $288,300 - $60,000) $284,000.00 Total Stockholder's Equity $1,316,110.00Related Questions
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