Question

Splish Company was formed on July 1, 2018. It was authorized to issue 306,400 shares of $10 par value common stock and 101,400 shares of 7% $25 par value, cumulative and nonparticipating preferred stock. Splish Company has a July 1-June 30 fiscal year. The following information relates to the stockholders' equity accounts of Splish Company. Common Stock Prior to the 2020-2021 fiscal year, Splish Company had 111,200 shares of outstanding common stock issued as follows. 1. 81,900 shares were issued for cash on July 1, 2018, at $30 per share. 2. On July 24, 2018,5,000 shares were exchanged for a plot of land which cost the seller $68,100 in 2012 and had an estimated fair value of $220,900 on July 24, 2018. 3. 24,300 shares were issued on March 1, 2019, for $41 per share. During the 2020-2021 fiscal year, the following transactions regarding common stock took place. November 30, 2020 December 15, 2020 Splish purchased 1,900 shares of its own stock on the open market at $37 per share. Splish uses the cost method for treasury stock. Splish declared a 5% stock dividend for stockholders of record on January 15, 2021, to be issued on January 31, 2021. Splish was having a liquidity problem and could not afford a cash dividend at the time. Splish's common stock was selling at $47 per share on December 15, 2020. Splish sold 540 shares of its own common stock that it had purchased on November 30, 2020, for $20,100. June 20, 2021 Preferred Stock Splish issued 43,600 shares of preferred stock at $48 per share on July 1, 2019. Cash Dividends Splish has followed a schedule of declaring cash dividends in December and June, with payment being made to stockholders of record in the following month. The cash dividends which have been declared since inception of the company through June 30, 2021, are shown below. Declaration Date 12/15/19 6/15/20 12/15/20 Common Preferred Stock Stock $0.30 per share $1 per share $0.30 per share $1 per share $1 per share No cash dividends were declared during June 2021 due to the company's liquidity problems.

Answer 1

Splish Company
Stockholders’ Equity
June 30, 2021
Capital stock
preferred stock (43600*25)	1090000
Common stock ((81900+5000+24300)+(5%*(81900+5000+24300-1900))*10)	1166650
Total capital stock		2256650
Additional paid-in capital
In excess of par-preferred (43600*(48-25))	1002800
In excess of par-common (81900*(30-10))+(220900-(5000*10))+(24300*(41-10))+ (((81900+5000+24300-1900)*5%)*(47-10))	2764405
Less: From treasury stock (540*(37-(20100/540)))	120	3767325
Total paid-in capital		6023975
Retained earnings (657300+38100-((81900+5000+24300-1900)*5%*47)-43600)		394945
Total paid-in capital and retained earnings		6418920
Less: Treasury stock (1900-540)*37		50320
Total stockholders’ equity		$6368600