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5 September, 00:38

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 Inc. on July 31, the end of the current year:

1

Common Stock, $36 par

$10,080,000.00

2

Paid-In Capital from Sale of Treasury Stock-Common

340,000.00

3

Paid-In Capital in Excess of Par-Common Stock

420,000.00

4

Paid-In Capital in Excess of Par-Preferred Stock

384,000.00

5

Preferred 1% Stock, $150 par

7,200,000.00

6

Retained Earnings

71,684,000.00

7

Treasury Stock-Common

1,008,000.00

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.

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Answers (1)
  1. 5 September, 01:10
    0
    Stockholders' Equity

    Preferred 1% Stock, $150 par $7,200,000

    Common Stock, $36 par $10,080,000

    Paid-In Capital Treasury Stock-Common $340,000

    Total Paid In capital $17,620,000

    Paid-In Capital Excess Par Common Stock $420,000

    Paid-In Capital Excess Par Preferred Stock $ 384,000

    Retained Earnings $71,684,000

    Treasury Stock-Common ($1,008,000)

    Total Shareholder's Equity $89,100,000

    Explanation:

    Stockholder's equity is compromised of Common stock, all paid-in-capitals, retained earning and net of treasury stock. Treasury stock is the repurchase of earlier issued stock.
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