Question

The following is a summary of all relevant transactions of ABC Corporation since it was organized in 2019. 16,950 shares were authorized and 8,000 shares of common stock($50 par value) were issued at a price of $60. In 2012, 1,000 shares were issued as a stock dividend when the stock was selling for $68. 300 shares of common stock were bought at a cost of $72 per share. These 300 shares are still in the company treasury. 11,300 preferred shares were authorized and the company issued 5,600 of them ($100 par value) at $120. Some of the preferred stock was reacquired by the company and later reissued for $5,000 more than it cost the company. The corporation has eamed a total of $689,300 in net income after income taxes and paid out a total of $353,200 in cash dividends since incorporation. Prepare the stockholders' equity section of the balance sheet in proper form for ABC Corporation as of December 31, 2019. Account for treasury stock using the cost method. ABC CORPORATION Stockholder's Equity December 31, 2019 Capital Stock Preferred stock, $100 par value, 11,300 shares authorized, 5,600 shares issued & outstanding Common stock, $50 par value, 16,950 shares authorized, 9,000 shares issued;8,700 shares outstanding Total capital stock Additional paid-in capital Paid-in cap. in exc. of par-common Paid-in cap. in exc. of par-preferred Paid-in cap. from tres, stock-preferred Total paid-in capital Retained earnings Total paid-in cap. & retained earnings Less: Cost of treasury stock Total stockholders' equity

Answer 1

	Amount ($)	Amount ($)
Capital stock:
Preferred stock, $100 par value, 11300 shares authorized, 5,600 shares issued and outstanding (5600X100)		560,000
Common stock, $50 par value, 16950 shares authorized, 9000 shares issued, 8700 shares outstanding (8000+1000)X50		450,000
Total capital stock		1,010,000
Additional paid-in capital:
In excess of par - preferred (5,600 shares * $20)	112,000
In excess of par - common stock [(8000*$10)+(1000*$18)]	98,000
From treasury stock - preferred	5,000	215,000
Total paid-in capital		1,225,000
Retained earnings (689300-353200-68000)		268,100
Total paid-in capital and retained earnings		1,493,100
Cost of treasury stock (300 * $72)		-21,600
Total stockholders’ equity		1,471,500