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The Squash Company's shareholders' equity on January 1, 2018 was $3,125,500. During 2018, Squash Company reported...

The Squash Company's shareholders' equity on January 1, 2018 was $3,125,500. During 2018, Squash Company reported the following:

• Net income of $575,325.
• Declared cash dividends totaling $125,000; the dividends had not been paid as of December 31, 2018.
• Issued 10,000 shares of $5 par value common stock at $9 per share.
• Purchased 5,000 shares of its common stock for $9.75 per share; the shares are being held as treasury shares.
• Sold 1,500 shares of treasury stock for $9.25 per share.
• Issued 2,000 shares of $5 par value common stock resulting from the declaration of a stock dividend during 2018; the market value of the common stock on the date of declaration was $10.25 per share.

What was shareholders' equity as of December 31, 2018? (Show your computations in order to get partial credit in case your answer is incorrect)

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Expert Solution

Shareholder's Equity balance as of December 31, 2018 will be $3630950

Detail working for your refrence

Transation Common Stock + Paid In capital in Excess of Par - Common + Retained Earning - Treasury Stock Total Shareholder Equity
Beg $3,125,500.00
1 $575,325 $575,325.00
2 -$125,000 -$125,000.00
3 $50,000 $40,000 $90,000.00
4 -$48,750 -$48,750.00
5 -$750 $14,625 $13,875.00
6 $10,000 $10,500 -$20,500
Total $60,000 $50,500 $429,075 -$34,125 $3,630,950.00

ekkarill92 answered 2 years ago
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