Question

Power Drive Corporation designs and produces a line of golf equipment and golf apparel. Power Drive has 100,000 shares of common stock outstanding as of the beginning of 2018. Power Drive has the following transactions affecting stockholders' equity in 2018.
  

March 1 Issues 61,000 additional shares of $1 par value common stock for $58 per share.

May 10 Repurchases 5,600 shares of treasury stock for $61 per share.

June 1 Declares a cash dividend of $1.80 per share to all stockholders of record on June 15. (Hint:  Dividends are not paid on treasury stock.)

July 1 Pays the cash dividend declared on June 1.

October 21 Reissues 2,800 shares of treasury stock purchased on May 10 for $66 per share.
  

Power Drive Corporation has the following beginning balances in its stockholders' equity accounts on January 1, 2018: Common Stock, $100,000; Additional Paid-in Capital, $5,100,000; and Retained Earnings, $2,600,000. Net income for the year ended December 31, 2018, is $660,000.
  

Required:

Prepare the statement of stockholders’ equity for Power Drive Corporation for the year ended December 31, 2018. (Amounts to be deducted should be indicated by a minus sign.)

POWER DRIVE CORPORATION Statement of Stockholders' Equity For the Year Ended December 31, 2018 Common Stock Paid-in Capital Additional Retained Earnings Treasury Stock Total Stockholders' Equity $ 7,800,000 $ 5,100,000 $ $ 0 Balance, January 1 Issued common stock Purchase treasury stock 2,600,000 0 0 100,000 $ 61,000 0 0 op 0 0 Dividends 01 of Sale of treasury stock 0 0 Net income Balance, December 31 $ 161,000 5,100,000 2,600,000 0 $ 7,861,000
Please explain how you got every number.. thank you.

Answer 1

Statement of stockholder's equity

For the year ended December 31, 2018

	Common Stock	Additional paid in capital	Retained earnings	Treasury Stock	total Stockholder's equity
Balance, January 1	100000	5100000	2600000		7800000
Issue common Stock	61000	61000*57 = 3477000			3538000
Purchase treasury stock				5600*61 = -341600	-341600
Dividends			-279720		-279720
Sale of treasury stock		2800*5 = 14000		2800*61 = 170800	184800
Net income			660000		660000
Balance December 31	161000	8591000	2980280	-170800	11561480