Question

Roberto Corporation was organized on January 1, 2018. The firm was authorized to issue 86,000 shares of $5 par common stock. During 2018, Roberto had the following transactions relating to shareholders' equity:

Issued 9,400 shares of common stock at $5.50 per share.
Issued 19,400 shares of common stock at $9.70 per share.
Reported a net income of $104,000.
Paid dividends of $46,000.
Purchased 2,300 shares of treasury stock at $11.70 (part of the 19,400 shares issued at $9.70).

What is total shareholders' equity at the end of 2018?

Answer 1

Stockholders' equity statement

Stockholders’ equity
Common stock, $5 par value, 28,800 shares issued and 26,500 shares outstanding	144,000
Additional paid in capital in excess of par- Common stock	95,880
Retained earnings:
Net income 104,000
Less: Dividends - 46,000
	58,000
Total paid in capital and retained earnings	297,880
Less: Treasury stock (2,300 x 11.70)	(26,910)
Total stockholders’ equity	$270,970