Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Bikroy.com Inc. had the following shareholders equity on January 1, 2020. Preferred shares, 8%, $100 par value, 10,000 shares authorized, 4,000 shares issued $ 400,000

Bikroy.com Inc. had the following shareholders equity on January 1, 2020. Preferred shares, 8%, $100 par value, 10,000 shares authorized, 4,000 shares issued $ 400,000 Common shares, $2 par value, 200,000 shares authorized, 80,000 shares issued 160,000 Common shares subscribed, 10,000 shares 20,000 Contributed surplus - Preferred 940,000 Contributed surplus - Common 780,000 Retained Earnings 780,000 2,320,000 Less: Common share subscriptions receivable 40,000 Total shareholders equity $2,280,000 During 2020, the following transactions occurred. 1. Equipment was purchased in exchange of 500 shares of common stock. The shares market value on the exchange date was $14 per share. 2. Sold 1,000 shares of common stock and 100 shares of preferred stock for the lump-sum price of $29,000. The common shares had a market price of $17 at the time of the sale. 3. Sold 2,000 shares of preferred for cash at $106 per share 4. All of the subscribers paid their subscription prices into the firm. 5. The common shares were issued. 6. Repurchased and retired 1,000 common shares at $18 per share 7. Net Income for the year was $600,000. Prepared the shareholders equity section for the company as at December 31, 2020.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Health And Safety Environment And Quality Audits

Authors: Stephen Asbury

1st Edition

9780750680264, 978-0750680264

More Books

Students also viewed these Accounting questions