The following information is available for Peterson Corp:- **3/1/X2**: The company was formed and was authorized by the state for future issuance, 1,500,000 shares of $1 par value common stock and 100,000 shares of 5%, $10 par value preferred stock.- **3/15/X2**: The company issued 45,000 shares of its common stock for $12 a share.- **6/30/X2**: The company issued 500 shares of its preferred stock to an attorney for $5,000 worth of legal work.- **11/15/X2**: The company issued 300 shares of its preferred stock to a consultant for $4,300 worth of work.**Question**: What is reported as the total Capital Contributions on Peterson’s 12/31/X2 balance sheet in the Stockholders’ Equity section?**Options**:- 549,300- 53,000- 496,300- 2,500,000

Shareholder's equity is the fund which the company generates and accumulates for its shareholders through its activities. It comprises off capital contributed by them, retained earnings accumulated by the bussiness but excludes treasury shares repurchsed by the company for price stabilization. Since, information regarding retained earnings is not given, Stockholder's equity = capital contributed by shareholders = 45000 * $12 + $5000 + $4300 = $549300 Hence option A is correct.

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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

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