National League Gear has two classes of stock authorized: 5%, $20 par preferred, and $5 par value common. The following transactions affect stockholders' equity during 2021, National League's first year of operations: February 2 Issue 1.5 million shares of common stock for $30 per share. February 4 Issue 550,000 shares of preferred stock for $24 per share. June 15 Purchase 150,000 shares of its own common stock for $25 per share. August 15 Resell 112,500 shares of treasury stock for $40 per share. November 1 Declare a cash dividend on its common stock of $1.50 per share and a $550,000 (5% of par value) cash dividend on its preferred stock payable to all stockholders of record on November 15. (Hint: Dividends are not paid on treasury stock.) November 30 Pay the dividends declared on November 1. Prepare the stockholders' equity section of the balance sheet as of December 31, 2021. Net income for the year was $4,850,00 mounts to be deducted should be indicated by a minus sign.) NATIONAL LEAGUE GEAR Balance Sheet (Stockholders' Equity Section) December 31, 2021 tockholders' equity: ommon stock dditional paid-in capital Total paid-in capital etained earnings reasury stock Total stockholders' equity
National League Gear has two classes of stock authorized: 5%, $20 par preferred, and $5 par value common. The following transactions affect stockholders' equity during 2021, National League's first year of operations: February 2 Issue 1.5 million shares of common stock for $30 per share. February 4 Issue 550,000 shares of preferred stock for $24 per share. June 15 Purchase 150,000 shares of its own common stock for $25 per share. August 15 Resell 112,500 shares of treasury stock for $40 per share. November 1 Declare a cash dividend on its common stock of $1.50 per share and a $550,000 (5% of par value) cash dividend on its preferred stock payable to all stockholders of record on November 15. (Hint: Dividends are not paid on treasury stock.) November 30 Pay the dividends declared on November 1. Prepare the stockholders' equity section of the balance sheet as of December 31, 2021. Net income for the year was $4,850,00 mounts to be deducted should be indicated by a minus sign.) NATIONAL LEAGUE GEAR Balance Sheet (Stockholders' Equity Section) December 31, 2021 tockholders' equity: ommon stock dditional paid-in capital Total paid-in capital etained earnings reasury stock Total stockholders' equity
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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[The following information applies to the questions displayed below.]
National League Gear has two classes of stock authorized: 5%, $20 par preferred, and $5 par value common. The
following transactions affect stockholders' equity during 2021, National League's first year of operations:
February 2 Issue 1.5 million shares of common stock for $30 per share.
February 4 Issue 550,000 shares of preferred stock for $24 per share.
June 15 Purchase 150,000 shares of its own common stock for $25 per share.
August 15 Resell 112,500 shares of treasury stock for $40
November 1 Declare a cash dividend on its common stock of $1.50 per share and a $550,000 (5% of par value) cash
share.
dividend on its preferred stock payable to all stockholders of record on November 15. (Hint: Dividends
are not paid on treasury stock.)
November 30 Pay the dividends declared on November 1.
2. Prepare the stockholders' equity section of the balance sheet as of December 31, 2021. Net income for the year was $4,850,000.
(Amounts to be deducted should be indicated by a minus sign.)
NATIONAL LEAGUE GEAR
Balance Sheet
(Stockholders' Equity Section)
December 31, 2021
Stockholders' equity:
Common stock
Additional paid-in capital
Total paid-in capital
Retained earnings
Treasury stock
Total stockholders' equity
$](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe072f680-4c73-4386-b4db-def118fea4a2%2F5c4cd6c3-eaba-4938-86d2-4c573b9b32ed%2Ffispqzx_processed.png&w=3840&q=75)
Transcribed Image Text:Required information
[The following information applies to the questions displayed below.]
National League Gear has two classes of stock authorized: 5%, $20 par preferred, and $5 par value common. The
following transactions affect stockholders' equity during 2021, National League's first year of operations:
February 2 Issue 1.5 million shares of common stock for $30 per share.
February 4 Issue 550,000 shares of preferred stock for $24 per share.
June 15 Purchase 150,000 shares of its own common stock for $25 per share.
August 15 Resell 112,500 shares of treasury stock for $40
November 1 Declare a cash dividend on its common stock of $1.50 per share and a $550,000 (5% of par value) cash
share.
dividend on its preferred stock payable to all stockholders of record on November 15. (Hint: Dividends
are not paid on treasury stock.)
November 30 Pay the dividends declared on November 1.
2. Prepare the stockholders' equity section of the balance sheet as of December 31, 2021. Net income for the year was $4,850,000.
(Amounts to be deducted should be indicated by a minus sign.)
NATIONAL LEAGUE GEAR
Balance Sheet
(Stockholders' Equity Section)
December 31, 2021
Stockholders' equity:
Common stock
Additional paid-in capital
Total paid-in capital
Retained earnings
Treasury stock
Total stockholders' equity
$
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