Stockholders’ Equity (January 1) Common stock—$6 par value, 100,000 shares authorized, 30,000 shares issued and outstanding $ 180,000 Paid-in capital in excess of par value, common stock 140,000 Retained earnings 360,000 Total stockholders’ equity $ 680,000 Stockholders’ Equity (December 31) Common stock—$6 par value, 100,000 shares authorized, 35,200 shares issued, 4,000 shares in treasury $ 211,200 Paid-in capital in excess of par value, common stock 171,200 Retained earnings ($40,000 restricted by treasury stock) 420,000 802,400 Less cost of treasury stock (40,000 ) Total stockholders’ equity $ 762,400 The following transactions and events affected its equity during the year. Jan. 5 Declared a $0.40 per share cash dividend, date of record January 10. Mar. 20 Purchased treasury stock for cash. Apr. 5 Declared a $0.40 per share cash dividend, date of record April 10. July 5 Declared a $0.40 per share cash dividend, date of record July 10. July 31 Declared a 20% stock dividend when the stock’s market value was $12 per share. Aug. 14 Issued the stock dividend that was declared on July 31. Oct. 5 Declared a $0.40 per share cash dividend, date of record October 10. Problem 13-4A Part 3 3. What is the amount of retained earnings transferred to paid-in capital accounts (capitalized) for the stock dividend?

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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Stockholders’ Equity (January 1)
Common stock—$6 par value, 100,000 shares authorized, 30,000 shares issued and outstanding	$	180,000
Paid-in capital in excess of par value, common stock		140,000
Retained earnings		360,000
Total stockholders’ equity	$	680,000

Stockholders’ Equity (December 31)
Common stock—$6 par value, 100,000 shares authorized, 35,200 shares issued, 4,000 shares in treasury	$	211,200
Paid-in capital in excess of par value, common stock		171,200
Retained earnings ($40,000 restricted by treasury stock)		420,000
		802,400
Less cost of treasury stock		(40,000	)
Total stockholders’ equity	$	762,400

The following transactions and events affected its equity during the year.

Jan.	5	Declared a $0.40 per share cash dividend, date of record January 10.
Mar.	20	Purchased treasury stock for cash.
Apr.	5	Declared a $0.40 per share cash dividend, date of record April 10.
July	5	Declared a $0.40 per share cash dividend, date of record July 10.
July	31	Declared a 20% stock dividend when the stock’s market value was $12 per share.
Aug.	14	Issued the stock dividend that was declared on July 31.
Oct.	5	Declared a $0.40 per share cash dividend, date of record October 10.

Problem 13-4A Part 3

3. What is the amount of retained earnings transferred to paid-in capital accounts (capitalized) for the stock dividend?

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