Shelby Corporation was organized in January to operate an air-conditioning sales and service business. The charter issued by the state authorized the following capital stock: Common stock, $1 par value, 200,000 shares.Preferred stock, $10 par value, 6 percent, 50,000 shares. During January and February, the following stock transactions were completed: Collected $784,000 cash and issued 28,000 shares of common stock.Issued 19,000 shares of preferred stock at $38 per share; collected in cash.Net income for the year was $58,000; cash dividends declared and paid at year-end were $12,000.Required:Prepare the stockholders’ equity section of the balance sheet at December 31.

When stock are issued at price higher than the par value, they are said to be issued at premium and…

Answered: Shelby Corporation was organized in…

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter16: Retained Earnings And Earnings Per Share

Section: Chapter Questions

Problem 5MC: Kent Corporation was organized on January 1, 2014. On that date, it issued 200,000 shares of 10 par...

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Shelby Corporation was organized in January to operate an air-conditioning sales and service business. The charter issued by the state authorized the following capital stock:

Common stock, $1 par value, 200,000 shares.

Preferred stock, $10 par value, 6 percent, 50,000 shares.

During January and February, the following stock transactions were completed:

Collected $784,000 cash and issued 28,000 shares of common stock.
Issued 19,000 shares of preferred stock at $38 per share; collected in cash.

Net income for the year was $58,000; cash dividends declared and paid at year-end were $12,000.

Required:

Prepare the stockholders’ equity section of the balance sheet at December 31.

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