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The stockholders' equity section on the December 31 balance sheet of Chemfast Corporation reported the following...

The stockholders' equity section on the December 31 balance sheet of Chemfast Corporation reported the following amounts: Contributed Capital Preferred Stock (par $20; authorized 10,000 shares, ? issued, of which 1,000 shares are held as treasury stock) $ 116,000 Additional Paid-in Capital, Preferred 17,690 Common Stock (no-par; authorized 20,000 shares, issued and outstanding 6,600 shares) 699,600 Retained Earnings 36,000 Treasury Stock, 1,000 Preferred shares at cost 9,800 Assume that no shares of treasury stock have been sold in the past. Required: Complete the following statements. (Decreases should be indicated by a minus sign. Round per share to 2 decimal places.)

Solutions

Expert Solution

1. The number of shares of preferred stock issued was?

A. The number of preferred shares issued = Preferred Capital/Par Value per share

      = $116,000/$20 = 5,800 shares

2. The number of shares of preferred stock outstanding was?

A. The number of preferred shares outstanding = Preferred shares issued - Treasury preferred shares

= 5,800 shares - 1,000 shares = 4,800 shares

3. The average issue price of the preferred stock was?

A. Total contributed capital for preferred shares = Preferred capital+Additional paid-in capital, preferred

= $116,000+$17,690 = $133,690

Average Issue price per share = Total contributed capital for preferred shares/Preferred shares issued

= $133,690/5,800 shares = $23.05 per share

4. The average issue price of the common stock was?

A. Average Issue price of common stock = Common Stock capital/Shares issued

    = $699,600/6,600 shares = $106 per share


5. The treasury stock transaction decreased stockholders' equity by?

A. $9,800

6.The treasury stock cost? per share

A. Treasury stock cost per share = Treasury stock/Treasury preferred shares

= $9,800/1,000 shares = $9.80 per share


7. Total stockholders' equity is? ContributetlCapital Preferred Stock (Par $20; authorized 10,000 shares, 5800 issued, of which 1000 shares are held as treasury stock)
A.Total stockholder's equity = Contributed preferred capital+Common stock+Retained earnings-Treasury stock = $133,690+$699,600+$36,000-$9,800 = $859,490

Therefore total stockholder's equity is $859,490.

ekkarill92 answered 1 year ago
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