Specialty Auto Racing Inc. retails racing products for BMWs, Porsches, and Ferraris. The following accounts and their balances appear in the ledger of Specialty Auto Racing on July 31, the end of the current yearCommon stock, $36 par$10,100,00Paid-In Capital from Sale of Treasury Stock—Common340,000Paid-In Capital in Excess of Par—Common Stock420,000Paid-In Capital in Excess of Par—Preferred Stock369,000Preferred 1% Stock, $150 par7,200,000Retained Earnings71,684,000Treasury Stock - Common1,010,000Fifty thousand shares of preferred and 300,000 shares of common stock are authorized. There are 24,000 shares of common stock held as treasury stock. Prepare the Stockholders’ Equity section of the balance sheet as of July 31, the end of the current year, using Method 1 of Exhibit 9 on page 577. EXHIBIT 8Stockholders' Equity Section of a Balance SheetTelex Inc.Balance SheetDecember 31, 20Y7Stockholders' EquityPaid-in capital:Preferred 10% stock, $50 par (2,000 shares authorized andissued).$100,000Excess over par10,000Paid-in capital, preferred stock$ 110,000Common stock, $20 par (50,000 shares authorized,45,000 shares issued)..$900,000Excess over par190,000Method 1Paid-in capital, common stock..1,090,000From sale of treasury stock2,000Total paid-in capitalRetained earnings...$1,202,000350,000Treasury stock (600 shares at cost).Total stockholders' equity...(27,000)$1,525,000Stockholders'EquityContributed capital:Preferred 10% stock, $50 par (2,000 shares authorized andissued).....$ 100,000Common stock, $20 par (50,000 shares authorized,45,000 shares issued)900,000Method 2Additional paid-in capitalTotal contributed capital.202,000$1,202,000Retained earnings...350,000Treasury stock (600 shares at cost).Total stockholders'equity....(27,000)$1,525,000

The stockholder’s equity section of the company is prepared to calculate the total capital…

Answered: Specialty Auto Racing Inc. retails…

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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Specialty Auto Racing Inc. retails racing products for BMWs, Porsches, and Ferraris. The following accounts and their balances appear in the ledger of Specialty Auto Racing on July 31, the end of the current year

Common stock, $36 par	$10,100,00
Paid-In Capital from Sale of Treasury Stock—Common	340,000
Paid-In Capital in Excess of Par—Common Stock	420,000
Paid-In Capital in Excess of Par—Preferred Stock	369,000
Preferred 1% Stock, $150 par	7,200,000
Retained Earnings	71,684,000
Treasury Stock - Common	1,010,000

Fifty thousand shares of preferred and 300,000 shares of common stock are authorized. There are 24,000 shares of common stock held as treasury stock. Prepare the Stockholders’ Equity section of the balance sheet as of July 31, the end of the current year, using Method 1 of Exhibit 9 on page 577.

EXHIBIT 8
Stockholders' Equity Section of a Balance Sheet
Telex Inc.
Balance Sheet
December 31, 20Y7
Stockholders' Equity
Paid-in capital:
Preferred 10% stock, $50 par (2,000 shares authorized and
issued).
$100,000
Excess over par
10,000
Paid-in capital, preferred stock
$ 110,000
Common stock, $20 par (50,000 shares authorized,
45,000 shares issued)..
$900,000
Excess over par
190,000
Method 1
Paid-in capital, common stock..
1,090,000
From sale of treasury stock
2,000
Total paid-in capital
Retained earnings...
$1,202,000
350,000
Treasury stock (600 shares at cost).
Total stockholders' equity...
(27,000)
$1,525,000
Stockholders'Equity
Contributed capital:
Preferred 10% stock, $50 par (2,000 shares authorized and
issued).....
$ 100,000
Common stock, $20 par (50,000 shares authorized,
45,000 shares issued)
900,000
Method 2
Additional paid-in capital
Total contributed capital.
202,000
$1,202,000
Retained earnings...
350,000
Treasury stock (600 shares at cost).
Total stockholders'equity....
(27,000)
$1,525,000

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