Question

JC, Inc., has two classes of stock authorized: $100.00 par preferred and $0.01 par value common. As of the beginning of 20XC, 1,000 shares of preferred stock and 700,000 shares of common stock have been issued.

Record the following transactions to complete the Statement of Stockholders’ Equity:

		Effect on Stockholders’ Equity
1-Mar	Issue 500 additional shares of preferred stock for $102.00 per share
1-Apr	Issue 100,000 additional shares of common stock for $15 per share
1-Jun	Declare a cash dividend on both common and preferred stock of $2.00 per share to all stockholders of record on June 15.
30-Jun	Pay the cash dividend declared on June 1.
1-Aug	Repurchase 30,000 shares of common treasury stock for $16.00 per share
1-Oct	Reissue 20,000 shares of treasury stock purchased on August 1 for $19.00 per share
31-Dec	Net income for the year was $1,950,000

6.    $____________ When the shares were issued on March 1, how much did additional paid in capital increase?

7.    $______________On June 1^st when the dividend was declared, how much did retained earning decrease?

8.    $__________ On August 1^st when the shares were repurchased, how much did stockholders’ equity decrease?

9.    $____________ On August 1^st when the shares were repurchased, how much did net income decrease?                                                 

10. $____________On October 1^st when the shares were reissued, how much did additional paid in capital change (if decrease put “-“ in front of the number)?            

11. $______________Compute ending retained earnings on December 31^st.                                                         

12.          $______________Compute ending stockholders equity on December 31^st.                       

Answer 1