Cullumber Company has two classes of capital stock outstanding: 8%, $20 par preferred and $5 par common. At December 31, 2020, the following accounts were included in stockholders’ equity.Preferred Stock, 160,200 shares $ 3,204,000Common Stock, 1,983,000 shares 9,915,000Paid-in Capital in Excess of Par—Preferred Stock 200,000Paid-in Capital in Excess of Par—Common Stock 26,495,000Retained Earnings 4,431,000The following transactions affected stockholders’ equity during 2021.Jan. 1 29,300 shares of preferred stock issued at $24 per share.Feb. 1 48,800 shares of common stock issued at $21 per share.June 1 2-for-1 stock split (par value reduced to $2.50).July 1 28,100 shares of common treasury stock purchased at $11 per share. Cullumber uses the cost method.Sept. 15 10,200 shares of treasury stock reissued at $12 per share.Dec. 31 The preferred dividend is declared, and a common dividend of 55¢ per share is declared.Dec. 31 Net income is $2,103,000.Prepare the stockholders’ equity section for Cullumber Company at December 31, 2021

Calculation of retained earnings: Beginning retained earnings 4,431,000 Add: Net income…

Answered: Cullumber Company has two classes of…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Cullumber Company has two classes of capital stock outstanding: 8%, $20 par preferred and $5 par common. At December 31, 2020, the following accounts were included in stockholders’ equity.

Preferred Stock, 160,200 shares		$ 3,204,000
Common Stock, 1,983,000 shares		9,915,000
Paid-in Capital in Excess of Par—Preferred Stock		200,000
Paid-in Capital in Excess of Par—Common Stock		26,495,000
Retained Earnings		4,431,000

The following transactions affected stockholders’ equity during 2021.

Jan. 1		29,300 shares of preferred stock issued at $24 per share.
Feb. 1		48,800 shares of common stock issued at $21 per share.
June 1		2-for-1 stock split (par value reduced to $2.50).
July 1		28,100 shares of common treasury stock purchased at $11 per share. Cullumber uses the cost method.
Sept. 15		10,200 shares of treasury stock reissued at $12 per share.
Dec. 31		The preferred dividend is declared, and a common dividend of 55¢ per share is declared.
Dec. 31		Net income is $2,103,000.

Prepare the stockholders’ equity section for Cullumber Company at December 31, 2021

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