Accounting for various stockholders’ equity transactions (Learning Objective 7) 20–25 min.

At December 31, 2013, Fernandes, Corp., reported the following stockholders’ equity.

Paid-in Capital:

Common Stock, $6 par, 200,000 shares authorized, 140,000 shares issued Additional Paid-in Capital Total Paid-in Capital Retained Earnings Subtotal Less: Treasury stock, 2,200 shares at cost Total Stockholders’ Equity

$ 840,000 145,000 985,000 670,000 1,655,000

(63,800)

$1,591,200 During 2014, Fernandes completed these transactions and events in this order:

a. Sold 500 shares of treasury stock for $35 per share; the cost of these shares was

$29 per share.

b. Issued 1,100 shares of common stock at $20 per share.

c. Net income for the year was $203,000.

d. Declared and paid cash dividends of $40,000.

Requirement 1. Prepare Fernandes’s statement of stockholders’ equity for the year ended December 31, 2014.

AppendixLO1