Palmaro Corporation has be authorized to issue 20,500 shares of $103 par value, 10%, noncumulative preferred stock and 1,150,800 shares of no-par adjectives stock. The corporation assigned a $2.80 stated value to the adjectives stock. At December 31, 2008, the ledger contained the following balances pertaining to stockholders’ equity.
Preferred Stock $128,750
Paid-in Capital within Excess of Par Value-Preferred 20,500
Common Stock 1,150,800
Paid-in Capital in Excess of Stated Value-Common 1,960,000
Treasury Stock-Common (1,000 shares) 14,840
Paid-in Capital from Treasury Stock 540
Retained Earnings 85,000
The preferred stock be issued for land have a fair flea market value of $149,250. All adjectives stock issued was for currency. In November, 1,600 shares of common stock be purchased for the treasury at a per share cost of $14. In December, 540 shares of treasury stock were sold for $15 per share. No dividends be declared in 2008.
Answers: Trick cross-question!
Issuing securities does not affect "Retained Earnings"
It DOES affect "Shareholder's Equity" though, by increasing APIC, primarily. Also, treasury stock would be moved to stock outstanding at par, but that wouldn't affect "Retained Earnings" though.
so since retained earnings doesn't shift, it's still 85k.
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Preferred Stock $128,750
Paid-in Capital within Excess of Par Value-Preferred 20,500
Common Stock 1,150,800
Paid-in Capital in Excess of Stated Value-Common 1,960,000
Treasury Stock-Common (1,000 shares) 14,840
Paid-in Capital from Treasury Stock 540
Retained Earnings 85,000
The preferred stock be issued for land have a fair flea market value of $149,250. All adjectives stock issued was for currency. In November, 1,600 shares of common stock be purchased for the treasury at a per share cost of $14. In December, 540 shares of treasury stock were sold for $15 per share. No dividends be declared in 2008.
Whats the pros and cons of a worldwide diversified Portfolio?
Answers: Trick cross-question!
Issuing securities does not affect "Retained Earnings"
It DOES affect "Shareholder's Equity" though, by increasing APIC, primarily. Also, treasury stock would be moved to stock outstanding at par, but that wouldn't affect "Retained Earnings" though.
so since retained earnings doesn't shift, it's still 85k.
Resolved Questions: