Question

Brief Exercise 12.9 Shareholders' equity section of statement of financial position L.O.4, 8 Alexander, Limited, declared and distributed a 10 percent share dividend on its 700,000 shares of outstanding $5 par value ordinary share when the share was selling for $12 per share. The outstanding shares had originally been sold at $8 per share. The balance in retained earnings before the declaration of the share dividend, but after the addition of the current year's net income, was $995,000. Prepare the shareholders' section of Alexander's statement of financial position to reflect these facts. (Omit the "S" sign in your response.) ALEXANDER, LIMITED Shareholders' Equity Section of Statement of Financial Position (Date) (Click to select) (Click to select) $ CA (Click to select) Total shareholders' equity $

Answer 1

Shareholder equity sections
Common stock 700000 +700000*.10	3850000
Additional Paid in capital-Common stcok	2590000
	6440000
Retainned earnnings	155000
Total stockholder equity	6595000

workings

Stock dividend
Common stock 700000*10%*5	350000
Additional Paid in capital-Common stock 70000*(12-5)	490000
Total stock dividend	840000
Retained earnnings
Retained earnnings after adjustment for net income	995000
Less stock dividend	840000
Retainned earnnigs at the end	155000