Changes in Shareholders' Equity The shareholders' equity section of Flores Design Company's December 31, 2018, balance sheet appeared as follows: Contributed Capital: Preferred stock, $100 par (10,000 shares authorized, 1,250 shares issued) $125,000 Additional paid-in capital on preferred stock 55,000 Common stock, $10 par (60,000 shares authorized, 15,000 shares issued) 150,000 Additional paid-in capital on common stock 105,000 Total contributed capital $435,000 Retained earnings 78,000 Contributed capital and retained earnings $513,000 Less: Treasury stock (300 shares of common at $14 per share) (4,200) Total Shareholders' Equity $508,800 During 2019, the company entered into the following transactions affecting shareholders' equity: Issued 250 shares of preferred stock at $164 per share. Issued 3,000 shares of common stock at $17 per share. Reacquired 200 of its own common shares as treasury stock for $15 per share. Reissued 250 shares of treasury stock at $17 per share (FIFO basis). Net income for 2019 was $46,500. Dividends of $25,000 were distributed. Compute the return on shareholders' equity for 2019.
Changes in Shareholders' Equity The shareholders' equity section of Flores Design Company's December 31, 2018, balance sheet appeared as follows: Contributed Capital: Preferred stock, $100 par (10,000 shares authorized, 1,250 shares issued) $125,000 Additional paid-in capital on preferred stock 55,000 Common stock, $10 par (60,000 shares authorized, 15,000 shares issued) 150,000 Additional paid-in capital on common stock 105,000 Total contributed capital $435,000 Retained earnings 78,000 Contributed capital and retained earnings $513,000 Less: Treasury stock (300 shares of common at $14 per share) (4,200) Total Shareholders' Equity $508,800 During 2019, the company entered into the following transactions affecting shareholders' equity: Issued 250 shares of preferred stock at $164 per share. Issued 3,000 shares of common stock at $17 per share. Reacquired 200 of its own common shares as treasury stock for $15 per share. Reissued 250 shares of treasury stock at $17 per share (FIFO basis). Net income for 2019 was $46,500. Dividends of $25,000 were distributed. Compute the return on shareholders' equity for 2019.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Changes in Shareholders' Equity
The shareholders' equity section of Flores Design Company's December 31, 2018,
| Contributed Capital: | |
| |
$125,000 |
| Additional paid-in capital on preferred stock | 55,000 |
| Common stock, $10 par (60,000 shares authorized, 15,000 shares issued) | 150,000 |
| Additional paid-in capital on common stock | 105,000 |
| Total contributed capital | $435,000 |
| 78,000 | |
| Contributed capital and retained earnings | $513,000 |
| Less: |
(4,200) |
| Total Shareholders' Equity | $508,800 |
During 2019, the company entered into the following transactions affecting shareholders' equity:
- Issued 250 shares of preferred stock at $164 per share.
- Issued 3,000 shares of common stock at $17 per share.
- Reacquired 200 of its own common shares as treasury stock for $15 per share.
- Reissued 250 shares of treasury stock at $17 per share (FIFO basis).
- Net income for 2019 was $46,500. Dividends of $25,000 were distributed.
Compute the return on shareholders' equity for 2019.
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