On December 31, 20X1, the Stockholders’ Equity section of Mercedes Corporation was as follows: Common stock, par value $5; authorized 30,000 shares; issuedand outstanding, 9,000 shares $ 45,000 Additional paid-in capital 58,000 Retained earnings 73,000 Total stockholders’ equity $ 176,000 On March 1, 20X2, the board of directors declared a 10% stock dividend and accordingly issued 900 additional shares. The stock’s fair value at that time was $8 per share. For the three months ended March 31, 20X2, Mercedes sustained a net loss of $16,000. Required: 1a. Prepare the journal entry for the stock dividend. 1b. What amount should the company report as retained earnings on its quarterly financial statement dated March 31, 20X2?
On December 31, 20X1, the Stockholders’ Equity section of Mercedes Corporation was as follows: Common stock, par value $5; authorized 30,000 shares; issuedand outstanding, 9,000 shares $ 45,000 Additional paid-in capital 58,000 Retained earnings 73,000 Total stockholders’ equity $ 176,000 On March 1, 20X2, the board of directors declared a 10% stock dividend and accordingly issued 900 additional shares. The stock’s fair value at that time was $8 per share. For the three months ended March 31, 20X2, Mercedes sustained a net loss of $16,000. Required: 1a. Prepare the journal entry for the stock dividend. 1b. What amount should the company report as retained earnings on its quarterly financial statement dated March 31, 20X2?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
On December 31, 20X1, the
| Common stock, par value $5; authorized 30,000 shares; issued and outstanding, 9,000 shares |
$ | 45,000 | |
| Additional paid-in capital | 58,000 | ||
| 73,000 | |||
| Total stockholders’ equity | $ | 176,000 | |
On March 1, 20X2, the board of directors declared a 10% stock dividend and accordingly issued 900 additional shares. The stock’s fair value at that time was $8 per share. For the three months ended March 31, 20X2, Mercedes sustained a net loss of $16,000.
Required:
1a. Prepare the
1b. What amount should the company report as retained earnings on its quarterly financial statement dated March 31, 20X2?
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