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The stockholders' equity accounts

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Excell Problem P12-3B

Journalize and post transactions; prepare stockholders' equity section; compute book value.

The stockholders' equity accounts of Pedro Corporation on January 1, 2002, were ar follows:

Preferred stock (10%, $100 par noncumulative, 5,000 shares authorized) $300,000
Common stock($5 stated value, 300,000 shares authorized) 1,000,000
Paid-in capital in excess of par value- P/S 15,000
Paid-in capital in excess of par value - C/S 400,000
Retained earnings 488,000
Treasury stock (5,000 shares) 40,000

During 2002, the corporation had the following transactions and events pertaining to its stockholders' equity:
Feb1 Issued 4,000 shares of common stock for $250,000.
March 20 Purchased 1,000 additional shares of common treasury stock at $8 per share
Jun 14 Sold 4,000 shares of treasury stock - common for $34,000.
Sept 3 Issued 2,000 shares of common stock for a patent valued at $13,000.
Dec 31 Determined that net income for the year was $215,000.

Instructions:
A. Journalize the transactions and the closing entry for net income.
B. Enter the beginning balances in the accounts and post the journal entries to the stockholders
Equity.
C. Prepare a stockholders' equity section of the balance sheet at December 31, 2002.
D. Compute the book value per share of common stock at December 31, 2002, assuming the preferred stock does not have a call price.

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Solution Summary

Word file contains journal entries stockholders' equity section of the balance sheet and calculations of book value per share of Pedro Corporation.

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Winslow Design Company: Changes in stockholders equity; return on equity

Changes in Stockholders Equity
The stockholders' equity section Winslow Design Company's 12-31, 2009 balance
sheet as appeared as follows:
Contributed capital
Preferred stock-$100 par (10,000 shares authorized, 1250 shares issued) 125,000
Additional paid in capital on preferred stock 55,000
Common stock-$10 par (60,000 shares authorized, 15,000 shares issued) 150,000
Additional paid in capital on commom stock 105,000
Total contributed capital 435,000
Retained earnings 78,000
Contributed capital and retained earnings 513,000
Less: Treasury stock (300 shares of common at $14 per share) -4,200
Total stockholders; equity 508,800

During 2010 the company entered into the following transactions affecting stockholders equity
1. Issued 250 shares of preferrd stock at $164 per share
2. Issued 3,000 shares of common stock at 17 per share
3. Reaquired 200 of its own common sahes as treasury stock for $15 per share
4. Reissued 250 shares of treasury stock at $17 per share (FIFO)
5. Net income for 2010 was $46,500. Dividends of $25,000 were distributed

Required
1. Prepare a statement of changes in stockholders equiy for the year ended 12-31-2010
2. Compute the return of stockholders equity for 2010

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