Assume that the stockholders' equity section on the balance sheet of Mangum's, a popular department store, is shown below. During the year, the company reported net income of $241,255,000 and declared and paid dividends of $11,899,000.Stockholders’ Equity:Current YearLast YearCommon stock, Class A—116,740,308 and 116,475,495 shares issued; ? and ? shares outstanding$ 1,167,000$ 1,165,000Common stock, Class B (convertible)—4,100,929 shares issued and outstanding41,00041,000Additional paid-in capital773,055,000788,987,000Retained earnings2,487,727,000?Less treasury stock, at cost, Class A—47,306,748 and 45,420,148 shares(1,883,581,000)(938,560,000)Required:What is the par value of Magnum's Class A common stock?How many shares of Class A Common Stock were outstanding at the end of last year and the end of the current year?What amount was reported in the Retained Earnings account at the end of last year?How is the dollar amount in the treasury stock account at the end of the current year reflected on the asset side of the balance sheet?During the current year, by what amount did treasury stock transactions increase or decrease stockholders' equity?At the end of the current year, what was the average price paid per share for shares held in treasury stock?

Requirement:-1 Calculation of the the par value of Magnum's Class A common stock as follows under:-…

Answered: Assume that the stockholders' equity…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Stockholders’ Equity:	Current Year	Last Year
Common stock, Class A—116,740,308 and 116,475,495 shares issued; ? and ? shares outstanding	$ 1,167,000	$ 1,165,000
Common stock, Class B (convertible)—4,100,929 shares issued and outstanding	41,000	41,000
Additional paid-in capital	773,055,000	788,987,000
Retained earnings	2,487,727,000	?
Less treasury stock, at cost, Class A—47,306,748 and 45,420,148 shares	(1,883,581,000)	(938,560,000)

Required:

What is the par value of Magnum's Class A common stock?
How many shares of Class A Common Stock were outstanding at the end of last year and the end of the current year?
What amount was reported in the Retained Earnings account at the end of last year?
How is the dollar amount in the treasury stock account at the end of the current year reflected on the asset side of the balance sheet?
During the current year, by what amount did treasury stock transactions increase or decrease stockholders' equity?
At the end of the current year, what was the average price paid per share for shares held in treasury stock?

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