Finishing Touches has two classes of stock authorized: 8%, $10 par preferred, and $1 par value common. The following transactions affect stockholders' equity during 2018, its first year of operations: January 2 Issues 100,000 shares of common stock for $28 per share. February 6 Issues 2,300 shares of 8% preferred stock for $12 per share. September 10 Purchases 10,000 shares of its own common stock for $33 per share. December 15 Reissues 5,000 shares of treasury stock at $38 per share. In its first year of operations, Finishing Touches has net income of $153,000 and pays dividends at the end of the year of $95,000 ($1 per share) on all common shares outstanding and $1,840 on all preferred shares outstanding. Required: Prepare the stockholders' equity section of the balance sheet for Finishing Touches as of December 31, 2018. (Amounts to be deducted should be indicated by a minus sign.) FINISHING TOUCHES Balance Sheet (Stockholders' Equity Section) December 31, 2018 Stockholders' equity: Common stock Preferred stock Additional paid-in capital Total paid-in capital Retained earnings Treasury stock Total stockholders' equity $ $ 100,000 23,000 123,000 56,160 179,160
Finishing Touches has two classes of stock authorized: 8%, $10 par preferred, and $1 par value common. The following transactions affect stockholders' equity during 2018, its first year of operations: January 2 Issues 100,000 shares of common stock for $28 per share. February 6 Issues 2,300 shares of 8% preferred stock for $12 per share. September 10 Purchases 10,000 shares of its own common stock for $33 per share. December 15 Reissues 5,000 shares of treasury stock at $38 per share. In its first year of operations, Finishing Touches has net income of $153,000 and pays dividends at the end of the year of $95,000 ($1 per share) on all common shares outstanding and $1,840 on all preferred shares outstanding. Required: Prepare the stockholders' equity section of the balance sheet for Finishing Touches as of December 31, 2018. (Amounts to be deducted should be indicated by a minus sign.) FINISHING TOUCHES Balance Sheet (Stockholders' Equity Section) December 31, 2018 Stockholders' equity: Common stock Preferred stock Additional paid-in capital Total paid-in capital Retained earnings Treasury stock Total stockholders' equity $ $ 100,000 23,000 123,000 56,160 179,160
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Finishing Touches has two classes of stock authorized: 8%, $10 par preferred, and $1 par value common. The following transactions
affect stockholders' equity during 2018, its first year of operations:
January 2 Issues 100,000 shares of common stock for $28 per share.
February 6 Issues 2,300 shares of 8% preferred stock for $12 per share.
September 10 Purchases 10,000 shares of its own common stock for $33 per share.
December 15 Reissues 5,000 shares of treasury stock at $38 per share.
In its first year of operations, Finishing Touches has net income of $153,000 and pays dividends at the end of the year of $95,000 ($1
per share) on all common shares outstanding and $1,840 on all preferred shares outstanding.
Required:
Prepare the stockholders' equity section of the balance sheet for Finishing Touches as of December 31, 2018. (Amounts to be
deducted should be indicated by a minus sign.)
FINISHING TOUCHES
Balance Sheet
(Stockholders' Equity Section)
December 31, 2018
Stockholders' equity:
Common stock
Preferred stock
Additional paid-in capital
Total paid-in capital
Retained earnings
Treasury stock
Total stockholders' equity
$
$
100,000
23,000
123,000
56,160
179,160
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