Refer to the information in E10–9. Power Drive Corporation has the following beginning balances in its stockholders’ equity accounts on January 1, 2021: Common Stock, $100,000; Additional Paid-in Capital, $5,500,000; and Retained Earnings, $3,000,000. Net income for the year ended December 31, 2021, is $700,000.

Required:

Taking into consideration all the transactions recorded in E10–9, prepare the statement of stockholders’ equity for Power Drive Corporation for the year ended December 31, 2021, using the format provided.

E10-9

Power Drive Corporation designs and produces a line of golf equipment and golf apparel. Power Drive has 100,000 shares of common stock outstanding as of the beginning of 2021. Power Drive has the following transactions affecting stockholders’ equity in 2021.

March 1 Issues 65,000 additional shares of $1 par value common stock for $62 per share.

May 10 Purchases 6,000 shares of treasury stock for $65 per share.

June 1 Declares a cash dividend of $2.00 per share to all stockholders of record on

June 15.  Dividends are not paid on treasury stock.

July 1 Pays the cash dividend declared on June 1.

October 21 Resells 3,000 shares of treasury stock purchased on May 10 for $70 per share.

Transcribed Image Text:

POWER DRIVE CORPORATION Statement of Stockholders' Equity For the year ended December 31, 2021 Additional Total Treasury Stockholders' Equity Common Paid-In Retained Stock Capital Earnings Stock Balance, January 1 $100,000 $5,500,000 $3,000,000 $ -0- $8,600,000 Issue common stock Purchase treasury stock Declare dividends Resell treasury stock Net income Balance, December 31