Class15 - Solutions

Class15 - Solutions - EXERCISE 15-8 (a) $1,000,000 x 8% =...

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EXERCISE 15-8 (a) $1,000,000 x 8% = $80,000; $80,000 x 3 = $240,000. The cumulative dividend is disclosed in a note to the stockholders’ equity section; it is not reported as a liability. (b) Preferred Stock (4,000 x $100). .................... 400,000 Common Stock (4,000 x 7 x $10). .......... 280,000 Paid-in Capital in Excess of Par Value— Common. .............................................. 120,000 (c) Paid-in capital Preferred stock, $100 par 8%, 10,000 shares issued $1,000,000 Paid-in capital in excess of par (10,000 x $7) 70,000 1
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PROBLEM 15-3 AMADO COMPANY Stockholders’ Equity December 31, 2007 Capital Stock Preferred stock, $20 par, 8%, 175,000 shares issued and outstanding $ 3,500,000 Common stock, $2.50 par, 4,080,000 shares issued, 4,060,000 shares outstanding 10,200,000 Total capital stock 13,700,000 Additional paid-in capital Excess over par—preferred $ 250,000 Excess over par—common 27,600,000 From treasury stock transactions 20,000 27,870,000 Total paid-in capital 41,570,000 Retained earnings 4,290,000 Total paid-in capital and retained earnings 45,860,000 Less: Cost of treasury stock (20,000 shares common) (180,000 ) Total stockholders’ equity $45,680,000 Supporting balances are indicated in the following T-Accounts. Preferred Stock Bal. 3,000,000 1. 500,000 3,500,000 Paid-in Capital—Common Bal.27,000,000 4. 600,000 27,600,000 2
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PROBLEM 15-3 (Continued) Common Stock Bal.10,000,000 3. 200,000 10,200,000 Retained Earnings Bal. 4,500,000 9. 280,000 8. 2,100,000 10. 2,030,000 4,290,000 Paid-in Capital—Preferred Bal. 200,000 2. 50,000 250,000 Treasury Stock 5. 270,000 6. 90,000 180,000 Paid-in Capital—Treasury Stock 7. 20,000 20,000 1. Jan. 1 25,000 x $20
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Class15 - Solutions - EXERCISE 15-8 (a) $1,000,000 x 8% =...

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