Question

The stockholders' equity section on the December 31, 2014, balance sheet of American Corporation follows: Stockholders' Equity Contributed capital Preferred stock (par $28; authorized 17,000 shares, ? issued, $196,000 of which 1,000 shares are held as treasury stock) Common stock (no-par, authorized 20,000 shares, issued and outstanding 7,000 shares) Contributed capital (includes $2,300 from treasury 574,000 stock transactions) Retained earnings Cost of treasury stock, preferred 16,300 41,000 (21,000)

Answer 1

Solution 6- Cost per share
Total cost of Treasury stock	$     21,000.00
Number of Preferred shares in treasury stock	1,000
Cost per share	$             21.00

Solution 7-Total Stockholder's equity
Contributed capital
Preferred stock	$ 1,96,000.00
Common stock	$ 5,74,000.00
Contributed capital	$     16,300.00
Retained earnings	$     41,000.00
Treasury stock	$ (21,000.00)
Total Stockholder's equity	$ 8,06,300.00

Solution 8-Average Issue price
Total Common stock value	$ 5,74,000.00
Add: Contributed capital on common stock (16300-2300)	$     14,000.00
Total value	$ 5,88,000.00
Total number of common stock	7,000
Average issue price per share	$             84.00