May I get step by step approach on the following question. I need help on (b). But could you please check the accuracy for my answers in (a)? Please know the "Answer" areas are supposed to be blank and supposed to be filled in. Thank you for your time.
Identifying and Analyzing Financial Statement Effects of Stock Transactions
The stockholders' equity of Verrecchia Company at December 31, 2011, follows:
Common stock, $ 5 par value, 350,000 shares authorized; 150,000 shares issued and outstanding $ 750,000 Paid-in capital in excess of par value 600,000 Retained earnings 346,000
During 2012, the following transactions occurred:
Jan. 5 Issued 10,000 shares of common stock for $12 cash per share.
Jan. 18 Purchased 4,000 shares of common stock for the treasury at $14 cash per share.
Mar. 12 Sold one-fourth of the treasury shares acquired January 18 for $17 cash per share.
July 17 Sold 500 shares of the remaining treasury stock for $13 cash per share.
Oct. 1 Issued 5,000 shares of 8%, $25 par value preferred stock for $35 cash per share. This is the first issuance of preferred shares from the 50,000 authorized shares.
(a) Use the financial statement effects template to indicate the effects of each transaction.
Use negative signs with answers, when appropriate.
Balance Sheet
Transaction Cash Asset + Noncash Asset = Liabilities + Contributed
Capital
+ Earned
Capital
Jan. 5 110,000 Answer Answer 110,000 Answer Jan. 18 -60,000 Answer Answer -60,000 Answer Mar. 12 17,000 -17,000 Answer Answer Answer July. 17 7,000 Answer 7,000 Answer Answer Oct. 1 190,000 Answer Answer 190,000 Answer
Income Statement
Revenue
-
Expenses
= Net
Income
Answer Answer Answer Answer Answer Answer Answer Answer Answer Answer Answer Answer Answer Answer Answer
(b) Prepare the December 31, 2012, stockholders' equity section of the balance sheet assuming that the company reports net income of $72,500 for the year.
Use a negative sign with your answer for treasury stock.
Stockholders' Equity Paid-in capital 8% Preferred stock, $25 par value, 50,000 shares authorized, 5,000 shares issued and outstanding $Answer Common stock, $5 par value, 350,000 shares authorized; 160,000 shares issued Answer $Answer Additional paid-in capital Paid-in capital in excess of par value-preferred stock Answer Paid-in capital in excess of par value-common stock Answer Paid-in capital from treasury stock Answer Answer Total paid-in capital Answer Retained earnings Answer Answer Less: Treasury stock (2,500 shares) at cost (use a negative sign with your answer) Answer Total Stockholders' Equity $ Answer
May I get step by step approach on the following question. I need help on (b). But could you please check the accuracy for my answers in (a)? Please know the "Answer" areas are supposed to be blank and supposed to be filled in. Thank you for your time.
Identifying and Analyzing Financial Statement Effects of Stock Transactions
The stockholders' equity of Verrecchia Company at December 31, 2011, follows:
| Common stock, $ 5 par value, 350,000 shares authorized; 150,000 shares issued and outstanding | $ 750,000 |
| Paid-in capital in excess of par value | 600,000 |
| Retained earnings | 346,000 |
During 2012, the following transactions occurred:
Jan. 5 Issued 10,000 shares of common stock for $12 cash per share.
Jan. 18 Purchased 4,000 shares of common stock for the treasury at $14 cash per share.
Mar. 12 Sold one-fourth of the treasury shares acquired January 18 for $17 cash per share.
July 17 Sold 500 shares of the remaining treasury stock for $13 cash per share.
Oct. 1 Issued 5,000 shares of 8%, $25 par value preferred stock for $35 cash per share. This is the first issuance of preferred shares from the 50,000 authorized shares.
(a) Use the financial statement effects template to indicate the effects of each transaction.
Use negative signs with answers, when appropriate.
| Balance Sheet | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Transaction | Cash Asset | + | Noncash Asset | = | Liabilities | + | Contributed Capital | + | Earned Capital | |
| Jan. 5 | 110,000 | Answer | Answer | 110,000 | Answer | |||||
| Jan. 18 | -60,000 | Answer | Answer | -60,000 | Answer | |||||
| Mar. 12 | 17,000 | -17,000 | Answer | Answer | Answer | |||||
| July. 17 | 7,000 | Answer | 7,000 | Answer | Answer | |||||
| Oct. 1 | 190,000 | Answer | Answer | 190,000 | Answer | |||||
| Income Statement | |||||
|---|---|---|---|---|---|
| Revenue | - | Expenses | = | Net Income | |
| Answer | Answer | Answer | |||
| Answer | Answer | Answer | |||
| Answer | Answer | Answer | |||
| Answer | Answer | Answer | |||
| Answer | Answer | Answer | |||
(b) Prepare the December 31, 2012, stockholders' equity section of the balance sheet assuming that the company reports net income of $72,500 for the year.
Use a negative sign with your answer for treasury stock.
| Stockholders' Equity | ||
|---|---|---|
| Paid-in capital | ||
| 8% Preferred stock, $25 par value, 50,000 shares authorized, 5,000 shares issued and outstanding | $Answer | |
| Common stock, $5 par value, 350,000 shares authorized; 160,000 shares issued | Answer | $Answer |
| Additional paid-in capital | ||
| Paid-in capital in excess of par value-preferred stock | Answer | |
| Paid-in capital in excess of par value-common stock | Answer | |
| Paid-in capital from treasury stock | Answer | Answer |
| Total paid-in capital | Answer | |
| Retained earnings | Answer | |
| Answer | ||
| Less: Treasury stock (2,500 shares) at cost (use a negative sign with your answer) | Answer | |
| Total Stockholders' Equity | $ Answer | |
Related questions
ACT5725
The stockholders' equity of Verrecchia Company at December 31, 2016, follows:
| Common stock, $5 par value, 500,000 shares authorized; 350,000 shares issued and outstanding | $1,750,000 |
| Paid-in capital in excess of par value | 800,000 |
| Retained earnings | 634,000 |
During 2017, the following transactions occurred:
Jan. 5 Issued 10,000 shares of common stock for $13 cash per share.
Jan. 18 Repurchased 4,000 shares of common stock at $16 cash per share.
Mar. 12 Sold one-fourth of the treasury shares acquired January 18 for $19 cash per share.
July 17 Sold 500 shares of treasury stock for $14 cash per share.
Oct. 1 Issued 5,000 shares of 8%, $25 par value preferred stock for $36 cash per share. This is the first issuance of preferred shares from the 50,000 authorized preferred shares.
(a) Use the financial statement effects template to indicate the effects of each transaction.
Use negative signs with answers, when appropriate.
| Balance Sheet | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Transaction | Cash Asset | + | Noncash Assets | = | Liabilities | + | Contributed Capital | + | Earned Capital | |
| Jan. 5 | Answer | Answer | Answer | Answer | Answer | |||||
| Jan. 18 | Answer | Answer | Answer | Answer | Answer | |||||
| Mar. 12 | Answer | Answer | Answer | Answer | Answer | |||||
| July. 17 | Answer | Answer | Answer | Answer | Answer | |||||
| Oct. 1 | Answer | Answer | Answer | Answer | Answer | |||||
| Income Statement | |||||
|---|---|---|---|---|---|
| Revenue | - | Expenses | = | Net Income | |
| Answer | Answer | Answer | |||
| Answer | Answer | Answer | |||
| Answer | Answer | Answer | |||
| Answer | Answer | Answer | |||
| Answer | Answer | Answer | |||
(b) Prepare the December 31, 2017, stockholders' equity section of the balance sheet assuming that the company reports net income of $76,900 for the year.
Use a negative sign with your answer for treasury stock.
| Stockholders' Equity | ||
|---|---|---|
| Paid-in capital | ||
| 8% Preferred stock, $25 par value, 50,000 shares authorized, 5,000 shares issued and outstanding | $Answer | |
| Common stock, $5 par value, 500,000 shares authorized; 360,000 shares issued | Answer | $Answer |
| Additional Paid-in capital | ||
| Paid-in capital in excess of par value-preferred stock | Answer | |
| Paid-in capital in excess of par value-common stock | Answer | |
| Paid-in capital from treasury stock | Answer | Answer |
| Total paid-in capital | Answer | |
| Retained earnings | Answer | |
| Answer | ||
| Less: Treasury stock (2,500 shares) at cost (use a negative sign with answer) | Answer | |
| Total Stockholders' Equity | $Answer | |
act5725
The stockholders' equity of Verrecchia Company at December 31, 2016, follows:
| Common stock, $5 par value, 500,000 shares authorized; 350,000 shares issued and outstanding | $1,750,000 |
| Paid-in capital in excess of par value | 800,000 |
| Retained earnings | 634,000 |
During 2017, the following transactions occurred:
Jan. 5 Issued 10,000 shares of common stock for $13 cash per share.
Jan. 18 Repurchased 4,000 shares of common stock at $16 cash per share.
Mar. 12 Sold one-fourth of the treasury shares acquired January 18 for $19 cash per share.
July 17 Sold 500 shares of treasury stock for $14 cash per share.
Oct. 1 Issued 5,000 shares of 8%, $25 par value preferred stock for $36 cash per share. This is the first issuance of preferred shares from the 50,000 authorized preferred shares.
(a) Use the financial statement effects template to indicate the effects of each transaction.
Use negative signs with answers, when appropriate.
| Balance Sheet | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Transaction | Cash Asset | + | Noncash Assets | = | Liabilities | + | Contributed Capital | + | Earned Capital | |
| Jan. 5 | Answer | Answer | Answer | Answer | Answer | |||||
| Jan. 18 | Answer | Answer | Answer | Answer | Answer | |||||
| Mar. 12 | Answer | Answer | Answer | Answer | Answer | |||||
| July. 17 | Answer | Answer | Answer | Answer | Answer | |||||
| Oct. 1 | Answer | Answer | Answer | Answer | Answer | |||||
| Income Statement | |||||
|---|---|---|---|---|---|
| Revenue | - | Expenses | = | Net Income | |
| Answer | Answer | Answer | |||
| Answer | Answer | Answer | |||
| Answer | Answer | Answer | |||
| Answer | Answer | Answer | |||
| Answer | Answer | Answer | |||
(b) Prepare the December 31, 2017, stockholders' equity section of the balance sheet assuming that the company reports net income of $76,900 for the year.
Use a negative sign with your answer for treasury stock.
| Stockholders' Equity | ||
|---|---|---|
| Paid-in capital | ||
| 8% Preferred stock, $25 par value, 50,000 shares authorized, 5,000 shares issued and outstanding | $Answer | |
| Common stock, $5 par value, 500,000 shares authorized; 360,000 shares issued | Answer | $Answer |
| Additional Paid-in capital | ||
| Paid-in capital in excess of par value-preferred stock | Answer | |
| Paid-in capital in excess of par value-common stock | Answer | |
| Paid-in capital from treasury stock | Answer | Answer |
| Total paid-in capital | Answer | |
| Retained earnings | Answer | |
| Answer | ||
| Less: Treasury stock (2,500 shares) at cost (use a negative sign with answer) | Answer | |
| Total Stockholders' Equity | $Answer | |
