Refer to the information in E10-6. In its first year of operations, Finishing Touches has income of

Question:

Refer to the information in E10-6. In its first year of operations, Finishing Touches has income of $150,000 and pays dividends at the end of the year of $95,000 ($1 per share) on all common shares outstanding and $1,600 on all preferred shares outstanding.

E10-6

January 2 Issues 100,000 shares of common stock for $25 per share.

February 6 Issues 2,000 shares of 8% preferred stock for $12 per share.

September 10 Repurchases 10,000 shares of its own common stock for $30 per share.

December 15 Reissues 5,000 shares of treasury stock at $35 per share.

Required:

Prepare the stockholders' equity section of the balance sheet for Finishing Touches as of December 31, 2012.

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...