In: Accounting
On January 1, 2022, Sage Hill Inc. had these stockholders’
equity balances.
Common Stock, $1 par (2,500,000 shares authorized, 650,000 shares
issued and outstanding) $650,000
Paid-in Capital in Excess of Par Value 1,420,000
Retained Earnings 698,000 Accumulated Other Comprehensive Income
50,000
During 2022, the following transactions and events occurred.
1. Issued 46,500 shares of $1 par value common stock for $2 per
share.
2. Issued 61,000 shares of common stock for cash at $6 per
share.
3. Purchased 22,500 shares of common stock for the treasury at
$3.05 per share.
4. Declared and paid a cash dividend of $205,500.
5. Earned net income of $422,000.
6. Had other comprehensive income of $15,800.
Prepare the stockholders’ equity section of the balance sheet at
December 31, 2022.
Stockholder's equity section | |||||||
$ | |||||||
Common stock,$1 par (2500000 shares authorized,757500 shares issued | |||||||
and 735000 shares outstanding) | (Note:1) | 757500 | |||||
Paid-in capital in excess of par value | (Note:2) | 1771500 | |||||
Retained earnings | (Note:3) | 914500 | |||||
Accumulated other comprehensive income | (50000+15800) | 65800 | |||||
Treasury stock | (22500*3.05) | -68625 | |||||
Total stockholder's equity | 3440675 | ||||||
Note:1 | |||||||
Shares issued: | |||||||
Nos. | |||||||
Beginning balance | 650000 | ||||||
Add: | |||||||
common stock issued | (46500+61000) | 107500 | |||||
Total | 757500 | ||||||
Shares outstanding: | |||||||
Nos. | |||||||
Total shares issued | 757500 | ||||||
Less: Treasury shares purchased | 22500 | ||||||
Shares outstanding | 735000 | ||||||
Common stock in $=757500*1=$ 757500 | |||||||
Note:2 | |||||||
Paid-in capital in excess of par value | |||||||
$ | |||||||
Beginning balance | 1420000 | ||||||
Add:Common stock issued | |||||||
46500*(2-1) | 46500 | ||||||
61000*(6-1) | 305000 | ||||||
Total | 1771500 | ||||||
Note:3 | |||||||
Retained earnings | |||||||
$ | |||||||
Beginning balance | 698000 | ||||||
Add: Net income | 422000 | ||||||
1120000 | |||||||
Less: Cash dividend | 205500 | ||||||
Ending balance | 914500 | ||||||