The corporate charter of Alpaca Co. authorized the issuance of 10 million, $1 par common shares....

The corporate charter of Alpaca Co. authorized the issuance of 10 million, $1 par common shares. During 2020, its first year of operations, Alpaca had the following transactions: January 1 sold 8 million shares at $15 per share June 3 retired 2 million shares at $18 per share December 28 sold 2 million shares at $20 per share What amount should Alpaca report as common stock, in its december 31 2020 balance sheet?

Expert Solution

Solution:
	Calculation of Common Stock as on December 31, 2020
Date	Particulars	Par Value	Additional Paid in capital	Total of Common Stock

Jan.01	8 Million shares issued	$ 8,000,000	$ 112,000,000	$ 120,000,000
		( 8 Million X $ 1)	( 8 Million X $ 14)
Less:
June. 03	Retired 2 Million Shares	$ 2,000,000	$ 34,000,000	$ 36,000,000
		( 2 Million X $ 1)	( 2 Million X $ 17)

Add:
Dec .28	Sales of 2 Million Shares	$ 2,000,000	$ 38,000,000	$ 40,000,000
		( 2 Million X $ 1)	( 2 Million X $ 19)

	Total	$ 8,000,000	$ 116,000,000	$ 124,000,000


	Alpaca Report as Common Stock is as below,
	Common Stock , Issue and outstanding (Par Value)	$ 8,000,000
	Additional Paid In Capital - Common Stock	$ 124,000,000

	Total	$ 132,000,000

ekkarill92 answered 2 years ago

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