Question

On July 1, 2009, Pet Supplies Company had 600,000 shares of $0.50 par common stock issued and outstanding. The shareholders’ equity accounts at July 1, 2009, had the following balances:
Common stock ............ $ 300,000
Additional paid-in capital ....... 1,500,000
Retained earnings .......... 2,650,000
The following transactions occurred during the fiscal year ended June 30, 2010:
a. On July 30, issued 40,000 shares of $75 par value, 5% cumulative preferred stock at $85.
b. On October 1, reacquired 10,000 shares of common stock for $4 per share.
c. On December 1, declared a cash dividend of $1.00 per share on the common stock outstanding, payable on December 31, 2009, to shareholders of record on November 15.
d. Declared and paid dividends to preferred shareholders on December 31, 2009.
e. Net income for the year ended June 30, 2010, was $925,000.

Requirement
Prepare the shareholders’ equity section of Pet Supplies Company’s balance sheet at June 30, 2010.



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  • CreatedSeptember 01, 2014
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