A company has two classes of stock authorized: 7%, $10 par preferred, and $1 par value common. The following transactions affect stockholders' equity during Year 1, its first year of operations:   January   2   Issues 100,000 shares of common stock for $33 per share. February   6   Issues 2,800 shares of 7% preferred stock for $13 per share. September   10   Purchases 12,000 shares of its own common stock for $38 per share. December   15   Resells 6,000 shares of treasury stock at $43 per share. In its first year of operations, the company has net income of $158,000 and pays dividends at the end of the year of $94,000 ($1 per share) on all common shares outstanding and $1,960 on all preferred shares outstanding. Required: Prepare the stockholders' equity section of the balance sheet for the company as of December 31, Year 1.

Q: A company has the following two classes of stock authorized: 9%, $10 par value preferred and $1 par…

A: Journal entry is a system to record the business transaction in accounting books of an organization.…

Q: Eastport Inc. was organized on June 5, Year 1. It was authorized to issue 460,000 shares of $9 par…

A: Introduction: The shareholders' equity section of the balance sheet shows the stockholders' wealth.…

Q: Slacks 5th Avenue has two classes of stock authorized: $100 par preferred and $1 par common. As of…

A: January 15 Issue 2,000 additional shares of common stock for $20 per share. Effect: This transaction…

Q: A company has the following two classes of stock authorized: 9%, $10 par value preferred and $1 par…

A: Journal entries to record each transaction is as under:

Q: Finishing Touches has two classes of stock authorized: 7%, $10 par preferred, and $1 par value…

A: Stockholders’ equity: It refers to the residual amount of assets that are available to the company’s…

Q: Autumn Corporation was organized in August. It is authorized to issue 100,000 shares of $100 par…

A: Journal entries: Date Account title and explanation Debit Credit Aug. 22 Cash [2,000 x $105 ]…

Q: Bramble Corporation is authorized to issue both preferred and common stock. The par value of the…

A: Date Account Titles and Explanatiion Debit $ Credit $ Feb. 1 Cash (19500*57) 1111500…

Q: Flounder Corp. is authorized to issue both preferred and common stock. The par value of the…

A: If the Preferred shares are issued for more than the par value, then the excess cash received goes…

Q: Eastport Inc. was organized on June 5, Year 1. It was authorized to issue 320,000 shares of $10 par…

A: Common shares (Transaction 1)=Number of shares×Par value=20,000×$10=$200,000

Q: Eastport Inc. was organized on June 5, Year 1. It was authorized to issue 470,000 shares of $10 par…

A: Any amount paid in excess of the par value of share goes to Paid-in Capital in excess of Par.

Q: Finishing Touches has two classes of stock authorized: 7%, $10 par preferred, and $1 par value…

A: Value of common stock=Number of common shares issued×Par value=100,000×$1=$100,000

Q: Cole Corporation was organized on January 1, Year 1. The company was authorized to issue 100,000…

A: Retained earnings = Net Income - Dividend paid = $60,000 - $30,000 = $30,000

Q: ingra Corporation was organized in March. It is authorized to issue 600,000 shares of $100 par value…

A: journal entries: Date            particulars Debit Credit Mar 1 Cash [10,000 x $115] $1,150,000…

Q: A company has two classes of stock authorized: 8%, $10 par preferred, and $1 par value common. The…

A: Stockholder's Equity - Stockholder's Equity includes the amount contributed by shareholders issued…

Q: On January 1, Sweeney Corporation had 40,000 shares of $10 par value common stock issued and…

A: We have the following information: On January 1, Sweeney Corporation had 40,000 shares of $10 par…

Q: Eastport Inc. was organized on June 5, Year 1. It was authorized to issue 430,000 shares of $9 par…

A: Total face value of Common stock issued = No. of shares issued x Par value per share = (21000+46000)…

Q: Ammon Company is authorized to issue 500,000 shares of $5 par value preferred stock. In its first…

A: A Journal is made to record all the business transactions in chronological order. It is the first…

Q: What is the total amount recorded in the Common Stock account at the end of 20X2?   Select one:…

A: Total Shareholders' Equity  = Common Stock + Retained Earnings

Q: Denver Company had the following transactions affected Stockholders equity during the year :…

A: Preferred stock holder means those stock holder who will be getting dividend before the common…

Q: Weaver Corporation had the following stock issued and outstanding at January 1, Year 1. 1. 98,000…

A: Tje dividend is paid to shareholders from the retained earnings of the business.

Q: Wonder Sales is authorized to issue 100,000 shares of 2%, $100 par preferred stock and 1,000,000…

A: Paid in capital excess of par- preferred stock on January 2 nd = 5000 shares ×$10 = $50000

Q: Wingra Corporation was organized in March. It is authorized to issue 550,000 shares of $100 par…

A: Journal Entries: Journal entries are the building blocks of accounting, which is the act of…

Q: Inside Incorporated was issued a charter on January 15 authorizing the following capital stock:…

A: Stockholders' equity refers  to the resources staying in a business once all liabilities have been…

Q: On January 1, Guillen Corporation had 95,000 shares of no-par common stock issued and outstanding.…

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Q: A company has two classes of stock authorized: 9%, $10 par preferred, and $1 par value common. The…

A: Stockholder's equity section of balance sheet is as under:

Q: On January 1, Guillen Corporation had 95,000 shares of no-par common stock issued and outstanding.…

A: Journal entry: A journal entry is used to record day-to-day transactions of the business by debiting…

Q: Hi-C Company has $1,000,000 shares of 10%, $20 Par Value Preferred Stock outstanding. On December…

A: The Company has $1,000,000 shares of 10%, $ 20 Par Value Preferred Stock outstanding. On December…

Q: On January 1, Lorain Corporation had 2,000 shares of $5 par common stock authorized and outstanding.…

A: Treasury stock: Treaseury stock are the shares which are bought back by the company from the open…

Q: n January 1, Vermont Corporation had 41,000 shares of $12 par value common stock issued and…

A: Journal entry: This is the first step to record accounts. It is written in the same order in which…

Q: OM, Inc. was organized on January 1, 20X5. The firm was authorized to issue 1,000,000 shares of $3…

A: Total no. of common stock issued = 50,000 shares + 30,000 shares…

Q: Pronghorn Corp. was organized on January 1, 2022. It is authorized to issue 19,800 shares of 7%, $50…

A: Any amount which is paid in excess of the face value of the stock needs to be credited to paid in…

Q: Finishing Touches has two classes of stock authorized: 8%, $10 par preferred, and $1 par value…

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Q: Eastport Inc. was organized on June 5, Year 1. It was authorized to issue 310,000 shares of $8 par…

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Q: Helu Corporation was organized on January 1, with an authorization of 1,000,000 ordinary shares with…

A: Share premium is the amount received on issue of shares above par value.

Q: Sheridan Company was organized on January 1, 2022. It is authorized to issue 12,500 shares of 8%,…

A: Stated Value: When it issues no-par stock with a stated value, a company carries the shares in the…

Q: A company has the following two classes of stock authorized: 7%, $10 par value preferred and $1 par…

A: 1- Record the issuance of 200,000 shares of common stock for $17 per share. 2- Record the issuance…

Q: Nautical has two classes of stock authorized: $10 par preferred, and $1 par value common. As of the…

A:

Q: Spring Company is authorized to issue 7500,000 shares of $2 par value common stock. In its first…

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Q: Accounting Grouper Corporation is authorized to issue 22,000 shares of $50 par value, 10% preferred…

A: Stockholder's Equity - Stockholder's Equity includes the amount contributed by shareholders issued…

Q: The Vogel and Wallis Corporation is authorized to issue 15,000 shares of 10%, $50 par value…

A: The journal entries are prepared to keep the record of day to day transactions of the business.

Q: Fortuna Company is authorized to issue 1,000,000 shares of $1 par value common stock. In its first…

A: Shares can be referred to as the small denominations of the share capital of a company. The shares…

Q: Novak Corp. is authorized to issue both preferred and common stock. The par value of the preferred…

A: Preferred stock is another source of funds for an organization other than common stock. Preference…

Q: utical has two classes of stock authorized: $10 par preferred, and $1 par value common. As of the…

A: Journal entry is the process of documenting commercial transactions for the first time in the books…

Q: Moon Corporation received a charter that authorized the issuance of 119,000 shares of $7 par common…

A: The journal entries are prepared to record the day to day transactions of the business.

Q: Mt. Everst Company has $1,000,000 shares of 10%, $20 Par Value Preferred Stock outstanding. On…

A: 4% Stock Dividend is recorded using the market price of the stock as of the date of stock dividends…

Q: Eastport Inc. was organized on June 5, Year 1. It was authorized to issue 400,000 shares of $12 par…

A: The balance sheet shows the financial position of the company that includes the assets, liabilities,…

Q: A company has two classes of stock authorized: 9%, $10 par preferred, and $1 par value common. The…

A:

Q: Mt. Everest Company has $1,000,000 shares of 10%, $20 Par Value Preferred Stock outstanding. On…

A: 10% $20 Par Value Preferred Stock = $10,00,000 i.e.. 50,000 shares of $20 par each   Stock dividend…

Q: The Vogel and Wallis Corporation is authorized to issue 15,000 shares of 10%, $50 par value…

A: 1. AMOUNT OF PREFERRED STOCK : = $5,000 X $55  = $275,000   2. AMOUNT OF COMMON STOCK : = $16,000 X…

Stockholder's Equity

The stockholders’ equity (often referred to as the book value of the company) is the number of assets available to the stockholder after its entire liabilities is paid off. The stockholders’ equity is also sometimes referred to as owner's equity. The stockholders’ equity or book value generally includes common stock, treasury stock retained earnings. It is an indicator of a company's financial strength and is an important item on the company's balance sheet.