Question

Exercise 4 Alpha Corporation reports the following Information at the end of 2018: 415,000 28,550 850,000 | 64,800 18,000 6,800 5,600 35,000 1,700,000 300,000 900,000 200,000 6,000 150,000 6,800 1,223,000 1,524,000 120,000 18,500 Accumulated depreciation Cash and bank accounts Common stock Dividends distributed in 2018 Income tax payable Interest expenses Net income 2018 Number of common shares issued Number of preferred shares issued Paid in capital in excess of par-common Paid in capital in excess of par- preferred Preferred dividends in arrears Preferred stock, 5% Prepaid rent Retained earnings (beginning balance, credit) Sales revenue Treasury shares (common stock, unit price 10) Unearned revenue Choosing only the appropriate data among those listed above, determine the following amounts, clearly showing the calculations performed: a) Total contributed (paid-in) capital b) Retained earnings c) Shareholders' equity d) Par value per share of common stock e) Par value per share of preferred stock f) Number of common and preferred shares outstanding g) Book value per share of common stock h) Book value per share of preferred stock Journalize the following transactions in 2019: Distribution of a 2% stock dividend to the common shareholders (market value per share 12) 1,

Answer 1

Hey !

Your answers are as under.

a) 2100000 (common stock + preferred stock + paid in capital in excess of par-common + paid in capital in excess of par-preferred)

b) 1240000 ( retained earning beginning balance + net income - dividend distributed )

c) 2120000 ( common stock + preferred stock + retained earning - Treasury shares )

d) 0.5 ( common stock ÷ number of common shares issued )

e) 0.5 ( preferred stock ÷ number of preferred stock issued )

f) 1688000 ( common shares - Treasury shares = common shares outstanding ) preferred shares outstanding = 300000.

g ) 1.238 ( (common stock + retained earning)/( common stock outstanding - treasury shares) ).

h) 0.5 ( preferred stock / number of preferred stock outstanding )