A Emphasis Heading 1 THeadin Paragraph Exercise 11-2B Efect of accounting events on the financial statements of a sole proprietorship A sole proprietorship was started on January 1, Year 1, when it received $30,000 cash from Maria Lopez, the owner. During Year 1, the company earned $50,000 in cash revenues and paid $22,300 in cash expenses. Lopez withdrew $10,000 cash from the business during Year 1. Required Prepare an income statement, capital statement (statement of changes in equity), balance sheet, and statement of cash flows for Lopez's Year I fiscal year. Maria Lopez Sole Proprietorship Financial Statements Income Statement Capital Statement Styles Paragraph Maria Lopez Sole Proprietorship Financial Statements Balance Sheet Statement of Cash Flows Exercise 11-3B Efect of accosating events on the financial statements of a partnership LO 11-1 D. Reed and J. Files started the RF partnership on January 1, Year 1. The business acquired $70,000 cash from Reed and $140,000 from Files. During Year 1, the partnership earned $75,000 in cash reve- nues and paid $39,000 for cash expenses. Reed withdrew $2,000 cash from the business, and Files withdrew $4,000 cash. The net income was allocated to the capital accounts of the two partners in proportion to the amounts of their original investments in the business Required Prepare an income statement, capital statement, balance sheet, and statement of cash flows for the RF partnership for the Year I fiscal year. RF Partnership Financial Statements Income Statement Capital Statement Financial Statements Balance Sheet Statement of Cash Flows DFocus Exercise 11-4B Capital stock authorized, isswed, and outstanding LO 11-2 Bronson Inc. has 300,000 shares authorized, 175,000 shares issued, and 25,000 shares of treasury stock. At this point, Bronson has $820,000 of assets. $250,000 liabilities, $400,000 of common stock, and $170,000 of retained earnings. Further, assume that the market value of Bronson's common stock is $6 per share. Required a Determine the number of shares of stock that is outstanding. Determine the book value per share. Provide a rational explanation for the difference between the book value per share and the market value per share of Bronson Inc. common stock. b. c. a. Shares outstanding b. Book value per share = C. CREIGHTON COMPANY As of December 31, Year 3 Stockholders' equity Preferred stock, $6 stated value, 6 % cumulative, 250 shares authorized, 100 issued and outstanding Common stock, $6 par velue, 200 shares authorized 150 issued and outstanding Common stock, class B, $8 per value, 450 shares authorized, 100 issued and outstanding Common stock, no par, 200 shares authorized, 150 issued and outstanding Pald-in capital in excess of stated value-preferred $ 600 900 800 1,800 400 900 Paid-in capital in excess of par value-common Pald-in capital in excess of par value-class B common Retained earnings Total stockholders' equity 800 9,000 $15,200 Required Assuming the preferred stock was originaly issued for cash, determine the amount of cash that was collected when the stock was issued. b. Based on the class B common stock alone, determine the amount of the company's legal capital c. Based on the class B common stock akone, determine the minimum amount of assets that must be retained in the company as protectien for creditors d. Determine the number of shares of class B common stock that are avaitable to sell as of Decem- ber 31, Year 3 e. Assuming Creighton purchases treasury stock consisting of 50 shares of its no par common stock on January 1. Yeat 4, determine the amount fthe nopar common stock that would be outstanding immedialely after the purchase f. Based on the stockhollers euity setion shown earlier can you determine the market value of the preferred stoc? If yes, what is the market value of one share of this steek? a. b. C. d. e. Ap AT AaBbCcDc I. AaB A. AaB 1. Aa -A- Emphasis Heading 1 1THeading 2 THeadin Paragraph Styles Exercise 11-7B Cash dividends for preferred and common shareholders LO 11-3 ALR Corporation had the following stock issued and outstanding at January 1. Year I. 200,000 shares of $10 par common stock I. 8,000 shares of $100 par, 4 percent, noncumalative preferred stock. 2. On May 10, ALR Corporation declared the annual cash dividend on its 8,000 shares of preferred stock and a $0.50 per share dividend for the common shareholders. The dividends will be paid on June 15 to the shareholders of record on May 30 Required Determine the total amount of dividends to be paid to the preferred shareholders and common shareholders Computation of Dividends to Be Paid: 1 Heading 2 T Headina IE Heading 1 Emphasis Styles Paragraph Effect of isswing common stock on the balaace sheet LO 11-4 Exercise 11-8B Newly formed Irwin Services Corporation has 100,000 shares of $10 par common stock authorized. On March 1, Year 1, Irwin Services issued 20,000 shares of the stock for $12 per share. On May 2, the company issued an additional 30,000 shares for $15 per share. Irwin Services was not affected by other events during Year 1. Required a. Record the transactions in a horizontal statements model like the following one. In the Statement of Cash Flows column, indicate whether the item is an operating activity (OA), investing activity (LA), or financing activity (FA). Use NA to indicate that an element was not affected by the event Balance Sheet Income Statement Statement of Stk. Equity Liab + Assets Cash Flows Net Inc. Exp. Com. Stk Rev PIC In Excess + Cash h. Determine the amount Irwin Services would report for commos stock on the December 31. Year 1. balance sheet e. Determine the amount Irwin Services would report for paid-in capital in excess of par 4. What is the total amount of capital contributed by the owners? . What amount of total assets would Irwin Services report on the December 31, Year 1, balance sheel a. Stmt. of Income Statement Exp. Balance Sheet Net Inc Cash Flow Stkholders' Equity +C. Stk. Rev. Event Assets Liab Cash +PIC Exc. b. Common Stock: . Paid-In Capital in Excess of Par d. Total Paid-In Capital: e. Total Assets: 11-64 Exercise 11-9B Recording and reporting common and preferred stock transactions Reiss Inc. was organized on June 1, Year I. It was authorized to issue 500,000 shares of $10 par com- mon stock and 100,000 shares of 4 percent cumulative class A preferred stock. The class A stock had a stated value of $50 per share. The following stock transactions pertain to Reiss Inc. LO 11-4 1 Issued 40,000 shares of common stock for $16 per share. 2. Issued 20,000 shares of the class A preferred stock for $52 per share. Issued 60,000 shares of common stock for $20 per share. 3. Required Prepare the stockholderns equity section of the balance sheet immediately after these transactions. Stockholders' Equity: E e