The following Stockholders\' Equity section of the balance sheet prepared as of
ID: 2596358 • Letter: T
Question
The following Stockholders' Equity section of the balance sheet prepared as of the end of the current year contains errors.
Prepare a corrected Stockholders’ Equity section using Method 1 of
Exhibit 9
. Refer to the lists of Accounts and Amount Descriptions provided for the exact wording of the answer choices for text entries. For those boxes in which you must enter subtracted negative numbers use a minus sign.
Stockholders’ Equity
1
Paid-in capital:
2
Preferred 2% stock, $80 par
3
(125,000 shares authorized and issued)
$10,000,000.00
4
Excess of issue price over par
500,000.00
5
Paid-in capital, preferred stock
$10,500,000.00
6
Retained earnings
96,700,000.00
7
Treasury stock (75,000 shares at cost)
1,755,000.00
8
Dividends payable
430,000.00
9
Total paid-in capital
$109,385,000.00
10
Common stock, $20 par
11
(1,000,000 shares authorized, 825,000 shares issued)
17,655,000.00
12
Organizing costs
300,000.00
13
Total stockholders’ equity
$127,340,000.00
Accounts and Amount Descriptions
Stockholders’ Equity
Prepare a corrected Stockholders’ Equity section using Method 1 of
Exhibit 9
. Refer to the lists of Accounts and Amount Descriptions provided for the exact wording of the answer choices for text entries. For those boxes in which you must enter subtracted negative numbers use a minus sign.
Stockholders’ Equity
1
Paid-in capital:
2
3
4
5
6
7
8
9
10
11
12
Stockholders’ Equity
Explanation / Answer
1. Stockholder;s Equity Method 1 Exhibit 9
Method 1
S. NO
Particulars
1
Paid in capital:
2
Preferred 2% stock, $80 par (125,000 shares authorized and issued)
$10,000,000
3
Excess of issue price over par
500,000.00
4
Paid-in capital, preferred stock
10,500,000
5
Common stock, $20 par (1,000,000 shares authorized, 825,000 shares issued)
16,500,000
6
Excess of issue price over par
(17,655,000 – 16,500,000)
1,155,000
7
Paid-in capital, common stock
17,655,000
8
Total paid-in capital
28,155,000
8
Retained earnings (96,700,000 – 300,000)
96,400,000
9
Total
124,555,000
10
Treasury stock (75,000 shares at cost)
-1,755,000
12
Total stockholders’ equity
122,800,000
Note:
S. NO
Particulars
1
Paid in capital:
2
Preferred 2% stock, $80 par (125,000 shares authorized and issued)
$10,000,000
3
Excess of issue price over par
500,000.00
4
Paid-in capital, preferred stock
10,500,000
5
Common stock, $20 par (1,000,000 shares authorized, 825,000 shares issued)
16,500,000
6
Excess of issue price over par
(17,655,000 – 16,500,000)
1,155,000
7
Paid-in capital, common stock
17,655,000
8
Total paid-in capital
28,155,000
8
Retained earnings (96,700,000 – 300,000)
96,400,000
9
Total
124,555,000
10
Treasury stock (75,000 shares at cost)
-1,755,000
12
Total stockholders’ equity
122,800,000