Question

I am having difficulty figuring out the rest of this problem, primarily with regards to calculating APIC and Retained earnings for Stock Dividends. Also, I need assistance with the fourth problem, how to calculate the total value of shareholders' equity.

Could you please help show me how to solve?

Accounting for Share Transactions
The shareholders' equity section of the consolidated balance sheet of Wilson Industries appeared as follows at the beginning of the year:

Shareholders' Equity
Class A common stock, $0.04 par value; 20,000,000 shares authorized;
6,100,000 shares issued	$244,000
Additional paid-in-capital	472,508,000
Retained earnings	57,080,000
Currency translation adjustment	(9,648,000)
Total equity	$520,184,000

The following events occurred sequentially during the year:

1. A 2-for-1 forward stock split was executed.
2. A ten percent stock dividend was distributed when the Wilson share price was $80 per share.
3. Treasury stock valued at $12,000,000 was repurchased when the Wilson share price was $75 per share.

Required

1. How many Class A common shares are outstanding following the above events?

13260000

2. What is the par value per share of the Class A common stock following the above events? Round to the nearest three decimal places.

$0.02

3. Prepare a spreadsheet to illustrate the financial effects associated with the above three share transactions.

Use a negative sign with answers to indicate a reduction in an account balance and with treasury stock repurchase and balance.

Wilson Industries
Transaction	Stock Split	Stock Dividend	Share Repurchase	Balance Sheet Totals
Assets
Cash	$0	$0	$ -12000000	$ -12000000
Shareholders' Equity
Common stock	0	24400	0	24400
APIC	0	????	0	????
Retained earnings	0	????	0	????
Treasury stock	0	0	-12000000	-12000000
Total Shareholders' Equity				$ ????

4. Calculate the total value of shareholders' equity following the above events.

$????

Answer 1

1	Class A of common shares outstanding:
							No.of shares
	Beginning balance						6100000
	Stock split
	(2 for 1 stock split will double the number of common shares)						6100000
	Stock dividend		(6100000+6100000)*10%				1220000
							13420000
	Less: Treasury stock				(Note:1)		160000
	Common shares outstanding						13260000
	Note:1
	Treasury stock valued at $ 12000000 when share price was $ 75 per share
	Number of shares repurchased=12000000/75=160000 shares
2	Par value of common shares will halve since there is a 2 for 1 stock split
	Par value=0.04*1/2=$ 0.02
3			Wilson industries
	Transaction				Beg. Bal.	Stock split	Stock dividend	Share repurchase	Balance sheet totals
	Assets
	Cash							-12000000
	Shareholder's equity
	Common stock				244000		24400		268400
							(1220000*$ 0.02)
	APIC				472508000		97575600		570083600
							1220000*(80-0.02)
	Retained earnings				57080000		-97600000		-40520000
							(1220000*80)
	Currency translation adjustment				-9648000				-9648000
	Treasury stock							-12000000	-12000000
	Total shareholder's equity								508184000
	Note:
	Stock split don’t require any journal entries.So, no effect on balance sheet amounts.It simply increase the number of common shares
4	Value of shareholder's equity=$ 508184000