Question

Abe's Steakhouse is the largest upscale steakhouse company in the United States, based on total company- and franchisee-owned restaurants. The company's menu features a broad selection of high-quality steaks and other premium offerings. Assume the information below is from a recent annual report:

a. Common stock, $0.01 par value; 100,090,000 shares authorized; 23,563,356 issued and outstanding at the end of the current year, 23,385,356 issued and outstanding at the end of last year.

b. Additional paid-in capital: $194,389,000 at the end of the current year and $169,431,000 at the end of last year.

c. Retained earnings / (accumulated deficit): ($82,397,000) at the end of last year.

d. In the current year, net income was $53,983,000 and a cash dividend of $7,138,000 was paid.

Required:

Prepare the stockholders’ equity section of the balance sheet to reflect the above information for the current year and last year. (Amounts to be deducted should be indicated with a minus sign.)

Answer 1

Equity Section- Previous Year	Amountin $
Common stock-
Authorized 100,090,000 shares, Par value $0.01
Issued and Outstanding 23,385,356 Par value $0.01	233853.56
Additional Paid in capital	169,431,000
Retained Earnings	-82397000
Total Equity	87267853.56

Equity Section- Current Year	Amountin $	Amountin $
Common stock-
Authorized 100,090,000 shares, Par value $0.01
Issued and Outstanding 23,563,356. Par value $0.01		235633.56
Additional Paid in capital		194389000.00
Retained Earnings		-35552000.00
Opening balance	-82397000.00
Add: Net Income	53983000
Less: Dividend	7138000
Total Equity		159072633.56

Workings