Question

The following table presents the long-term liabilities and stockholders’ equity of Information Control Corp. one year ago:

Long-term debt	$	65,900,000
Preferred stock		4,090,000
Common stock ($1 par value)		15,900,000
Capital surplus		45,900,000
Accumulated retained earnings		135,900,000

  
During the past year, the company issued 10.9 million shares of new stock at a total price of $59.8 million, and issued $35.9 million in new long-term debt. The company generated $10.8 million in net income and paid $2.9 million in dividends.

Prepare the current balance sheet reflecting the changes that occurred at the company during the year. (Do not round intermediate calculations. Enter your answers in dollars, not millions of dollars, e.g., 1,234,567.)

INFORMATION CONTROL CORP. Current Balance Sheet
(Click to select)  Long-term debt  Accumulated retained earnings  Common stock  Capital surplus  Accounts payable  Preferred stock	$
Total long-term debt	$
Shareholders' equity
(Click to select)  Long-term debt  Common stock  Capital surplus  Accumulated retained earnings  Accounts payable  Preferred stock	$
(Click to select)  Common stock  Preferred stock  Long-term debt  Accumulated retained earnings  Capital surplus  Accounts payable
(Click to select)  Accumulated retained earnings  Accounts payable  Common stock  Long-term debt  Capital surplus  Preferred stock
(Click to select)  Common stock  Accounts payable  Long-term debt  Accumulated retained earnings  Preferred stock  Capital surplus
Total equity	$
Total liabilities & equity	$

Answer 1

Please see the table below:

Parameter	Before	What happened during the year?	During the year	Now
	A		B	C = A + B
Long-term debt	65,900,000	Fresh issuance of $ 35.9 mn debt =	35,900,000	101,800,000
Total Debt	65,900,000		35,900,000	101,800,000
Shareholders' Equity
Preferred stock	4,090,000	No change	-	4,090,000
Common stock ($1 par value)	15,900,000	10.9 mn new shares issued; 10.9 mn x $ 1 par value =	10,900,000	26,800,000
Capital surplus	45,900,000	10.9 mn new shares issued for $ 59.8 of which $ 10.9 mn capitalized in common stock; balance ($59.8 - $10.9) mn =	48,900,000	94,800,000
Accumulated retained earnings	135,900,000	Net income - dividends paid = $ 10.8 mn - $ 2.9 mn	7,900,000	143,800,000
Total Equity	201,790,000		67,700,000	269,490,000
Total Equity & Liability	267,690,000		103,600,000	371,290,000