Solution to Suggested QS & Exercise-Chapter 11

Solution to Suggested QS & Exercise-Chapter 11 -...

Info icon This preview shows pages 1–3. Sign up to view the full content.

Exercise 11-3 (15 minutes) 1. Cash ................................................................................... 35,000 Common Stock, $5 Par Value* ................................... 20,000 Paid-In Capital in Excess of Par Value, Common Stock** ..................................................... 15,000 Issued common stock for cash. *4,000 shares x $5 per share = $20,000 **$35,000 - $20,000 = $15,000 2. Organization Expenses .................................................... 40,000 Common Stock, $1 Stated Value ............................... 2,000 Paid-In Capital in Excess of Stated Value, Common Stock ........................................................ 38,000 Issued stock to promoters. 3. Organization Expenses .................................................... 40,000 Common Stock, No-Par Value ................................... 40,000 Issued stock to promoters. 4. Cash .................................................................................... 60,000 Preferred Stock, $50 Par Value* ................................. 50,000 Paid-In Capital in Excess of Par Value, Preferred Stock** ...................................................... 10,000 Issued preferred stock for cash. *1,000 shares x $50 per share = $50,000 **$60,000 - $50,000 = $10,000 Exercise 11-5 (10 minutes) 1. C 2. A 3. F 4. E 5. B 6. D Exercise 11-6 (20 minutes) 1. a. Retained earnings Before dividend ........................................................................ $ 660,000 $10 par value of 25,000 dividend shares ............................... (250,000 ) After dividend ........................................................................... $ 410,000 b. Total stockholders’ equity Common stock $10 par value, 120,000 shares authorized, 75,000 shares issued and outstanding ........... $ 750,000
Image of page 1

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

Paid-in capital in excess of par value .................................... 200,000 Retained earnings .................................................................... 410,000 Total stockholders’ equity ....................................................... $1,360,000 c. Number of outstanding shares Outstanding shares before the dividend .............................. 50,000 Dividend shares ...................................................................... 25,000 Outstanding shares after the dividend ................................. 75,000 2.
Image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern