The balance sheet of Avery Hardware, Inc., at December 31, 2017, reported 700,000 shares of $3 par
Question:
The balance sheet of Avery Hardware, Inc., at December 31, 2017, reported 700,000 shares of $3 par common stock authorized, with 95,000 shares issued and outstanding. Paid-in Capital in Excess of Par—Common had a balance of $320,000. Retained Earnings had a balance of $101,000. During 2018, the company completed the following selected transactions:
Feb 15 Purchased 11,000 shares of treasury stock at $4 per share.
Mar 8 Sold 7,000 shares of treasury stock for $6 per share.
Sep 28 Declared and distributed a 10% stock dividend on the 91,000 shares of outstanding common stock. The market value of Avery Hardware’s common stock was $13 per share.
Requirements
1. Record the transactions in the journal. Explanations are not required.
2. Prepare the stockholders’ equity section of the balance sheet at December 31, 2018, assuming the company earned $111,000 of net income during the year.
Common StockCommon 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... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...
Step by Step Answer:
Req 1 Journal DATE ACCOUNTS POST REF Dr Cr 2018 Feb 15 Treasury Stock 11000 shares x 4 44000 Cash 44...View the full answer
