The shareholders’ equity section of the balance sheet of The Claremont Company appeared as follows at the end of the first year of operations:

During the second year of operations, the following transactions occurred:
1. Generated net income of \($6\) million.
2. Paid a cash dividend of \($1.5\) million.
3. Purchased 100,000 shares of common stock at \($9.50\) per share.
4. Executed a 1-for-2 reverse stock split.
Prepare the shareholders’ equity section of the balance sheet of Claremont Company at the end of the second year of operations.

Transcribed Image Text:

Common stock, $0.10 par value Additional paid-in-capital.. Retained earnings Treasury stock Shareholders' equity 600,000 89,400,000 32,000,000 (7,500,000) $114,500,000