IDNLearn.com: Your go-to resource for finding expert answers. Explore a wide array of topics and find reliable answers from our experienced community members.
Sagot :
Answer:
Stockholders' Equity = $735,000
Explanation:
This can be prepared as follows:
Witt Corporation
Stockholders' Equity Section of the Balance Sheet
At December 31, 2011
Details Amount ($)
Common stock (w.1) 344,000
Preferred stock (w.2) 65,000
Additional paid in capital - Common stock (w.3) 181,000
Additional paid in capital - Preferred stock (w.4) 49,000
Net income 96,000
Stockholders' Equity 735,000
Workings:
w.1. Common stock = (Number of common shares issued in transaction a + Number of common shares issued in transaction c) * Par value of common stock = (40,000 + 3,000) * $8 = $344,000
w.2. Preferred stock = (Number of preferred shares issued in transaction b + Number of preferred shares sold in transaction c) * Par value of preferred stock = (5,500 + 1,000) * $10 = $65,000
w.3. Additional paid in capital - Common stock = (Number of common shares issued in transaction a * (Selling price per share of the transaction - Par value of common stock)) + (Number of common shares issued in transaction c * (Selling price per share of the transaction - Par value of common stock)) = (40,000 * ($12 - $8)) + (3,000 * ($15 - $8)) = $181,000
w.4. Additional paid in capital - Preferred stock = (Number of preferred shares issued in transaction b * (Selling price per share of the transaction - Par value of preferred stock)) + (Number of preferred shares issued in transaction c * (Selling price per share of the transaction - Par value of preferred stock)) = (5,500 * ($16 - $10)) + (1,000 * ($26 - $10)) = $49,000
The preparation of the Stockholders' Equity Section of the Witt Corporation's Balance Sheet as of December 31, 2011, is as follows:
Witt Corporation
Balance Sheet
As of December 31, 2011
Stockholders' Equity Section
Authorized Shares:
21,000 shares, 10% Preferred Stock at $10
50,000 shares, Common Stock at $8
Issued and Outstanding:
Common Stock, 43,000 shares $344,000
Additional Paid-in Capital- Common 181,000
10% Preferred Stock, 6,500 shares 65,000
Additional Paid-in Capital- Preferred 49,000
Retained Income 96,000
Total stockholders' equity $735,000
Data Analysis:
a. Cash $480,000 Common Stock $320,000 Additional Paid-in Capital-Common $160,000
b. Cash $88,000 10% Preferred Stock $55,000 Additional Paid-in Capital- Preferred $33,000
c. Cash $45,000 Common Stock $24,000 Additional Paid-in Capital-Common $21,000
Cash $26,000 10% Preferred Stock $10,000 Additional Paid-in Capital- Preferred $16,000
d. Net income for the year = $96,000
Learn more: https://brainly.com/question/17177730
We greatly appreciate every question and answer you provide. Keep engaging and finding the best solutions. This community is the perfect place to learn and grow together. Find clear and concise answers at IDNLearn.com. Thanks for stopping by, and come back for more dependable solutions.
