# Reporting stockholders’ equity Using the following accounts and balances, prepare the Stockholders’ Equity section of the balance sheet using Method 1 of Exhibit 8. One hundred thousand shares of common stock are authorized, and 5,000 shares have been reacquired.

### Financial Accounting

15th Edition
Carl Warren + 2 others
Publisher: Cengage Learning
ISBN: 9781337272124

Chapter
Section

### Financial Accounting

15th Edition
Carl Warren + 2 others
Publisher: Cengage Learning
ISBN: 9781337272124
Chapter 13, Problem 6PEA
Textbook Problem
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## Reporting stockholders’ equityUsing the following accounts and balances, prepare the Stockholders’ Equity section of the balance sheet using Method 1 of Exhibit 8. One hundred thousand shares of common stock are authorized, and 5,000 shares have been reacquired.

To determine

Prepare the stockholders’ equity section of the balance sheet.

### Explanation of Solution

Stockholders’ Equity Section: It is refers to the section of the balance sheet that shows the available balance stockholders’ equity as on reported date at the end of the financial year.

Prepare the stockholders’ equity section of the balance sheet.

 Stockholders’ equity section Particulars Amount (\$) Amount (\$) Amount (\$) Paid-in Capital: Common Stock, \$2 par (100,000 shares      authorized, 75,000 shares issued) \$150,000 Excess over par \$2,250,000 Paid in capital, common stock \$2,400,000 From sale of treasury stock \$60,000 Total paid-in capital \$2,460,000 Retained earnings \$10,880,000 Total \$13,340,000 Less: Treasury stock (5,000 shares at cost) (\$140,000) Total stockholders’ equity \$13,200,000

Table (1)

The Proforma of the reporting the stockholders’ equity section of the partial balance sheet ...

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