Answered: Reporting Stockholders' Equity Using…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Using the following accounts and balances, prepare the “Stockholders’ Equity” section of the balance sheet. 50,000 shares of common stock authorized, and 1,000 shares have been reacquired.

Common Stock, $80 par	$2,400,000
Paid-In Capital from Sale of Treasury Stock	72,000
Paid-In Capital in Excess of Par—Common Stock	420,000
Retained Earnings	1,176,000
Treasury Stock	40,000

Reporting Stockholders' Equity
Using the following accounts and balances, prepare the "Stockholders' Equity" section of the balance sheet. 50,000 shares of common stock
authorized, and 1,000 shares have been reacquired.
Common Stock, $80 par
$2,400,000
Paid-In Capital from Sale of Treasury Stock
72,000
Paid-In Capital in Excess of Par-Common Stock
420,000
Retained Earnings
1,176,000
Treasury Stock
40,000
Balance Sheet
Stockholders' Equity
Paid-in capital:
Common Stock, $80 Par (50,000 Shares Authorized, 30,000 Shares Issued)
2,400,000
Excess of Issue Price Over Par
420,000
Paid-in capital, common stock
420,000 X
From Sale of Treasury Stock
40,000 x
Total paid-in capital
Retained Earnings
Total
Treasury Stock
Total stockholders' equity
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Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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