Question

4 The following information is provided for the newly formed corporation, LAX, Inc. on January 1, 2023: 5 Treasury Outstanding Authorized Issued Common stock, $1 par value: 100,000,000 35.000.000 34,510,000 Preferred stock, 6.5%, $100 par value: 1.000.000 500,000 Treasury stock, $42.35 basis: 490.000 10 11 1. On 3/31/23, LAX, Inc. issued 15,000,000 shares of of common stock in a seasoned offerring for $50.88 per share. Record the journal entry: 12 13 Date Accounts Debits Credits 14 15 2023/3/31 16 17 18 19 2. On 5/1/23, LAX, Inc. issued 100,000 shares of preferred stock for $101.62 each. Record the transaction: 20 21 22 23 Debits Date Accounts Credits 2023/5/1 24 25 27 3. Update the balance of outstanding shares: 28 Outstanding Treasury Authorized 29 30 Issued Common stock, $1 par value: 100,000,000 Preferred stock, 6.5%, $100 par value: 1,000,000 31 Treasury stock, $42.35 basis: 32 33 a 14. On 6/30/23. LAX sold 25.000 shares of treasury stock for $61.88. Record the transaction: 35 Date Accounts Debits Credits 36 2023/6/30 37 38 39 40 11 The following information is provided for LAX, Inc. for the year ending 12/31/23. Calculate the ratios: 12 13 14 15 16 Net income (Earnings): Preferred dividends paid: 45,780, 129 ROE EPS 942,280,129 Average stockholders' equity: Div yield Weighted-average common shares: P/E Annual dividend per share: 0.42 47 Stock price: $ 63.04 48 19 50 51 52 53

Answer 1

SOLUTION:

Credit No. 1 Debit $763,200,000 Date Accounts 3/31/2023 Cash Common stock Paid-in capital in excess of par- common stock $ 15,000,000 $ 748,200,000 2 5 $ 10,162,000 /1/2023 Cash Preferred stock Paid-in capital in excess of par- Preferred stock $ 10,000,000 $ 162,000

3.

Treasury Authorized 100,000,000 1,000,000 Common stock, $1 par value: Preferres stock, 6.5%, $100 par value: Treasury, stock, $42.35 basis : Issued 50,000,000 600,000 Outstanding 49,510,000 490,000

4.

4 $ 1,547,000 6/30/2023 Cash Common stock Paid-in capital, treasury stock $ $ 1,058,750 488,250

Note: you can also use 'Additional paid in capital' account instead of 'Paid-in capital in excess of par'.

5. ROE = Net earnings / Average stockholders' equity

= $45,780,129 / $942,280,129 = 4.86%

please specify, should I use all info. above to compute the rest 3 requirements ?