P13-3

sif Bledsoe deda common share What would be the effect on 25N common stock dividend on the outil selling at se per share! Common stock Additional pidin capital Retained earnings Total stockholders'equity What would be the effect on the following balance 2-far c k split at a time when the stock is selling at so Common stock Additional paid-in capital alling at $60 per share? s of $10 par value common stock, of ock, of which quity accounts at Decem P13-3 Retained earnings Treasury stock Total stockholders' equity Lyons, Inc., had 1,000,000 authorized shares of Sio par val 400,000 shares were issued and outstanding. The stockholders' cauit ber 31, 2004, had the following credit balances: Common stock Additional puid in capital-common Retained earnings Accumulated other comprehensive income $4,000,000 840,000 3,800,000 120,000 tockholders' equity ac- 79 cumulative preferred Transactions during 2005 and other information relating to the stockhold counts were as follows: a On January 8, 2005, Lyons issued 30,000 shares of $100 par, 7% cumul stock at $105 per share. Lyons had 30,000 authorized shares of preferred stor b On March 1.2005. Lyons reacquired 10,000 shares of its common stock at S12 per share. Lyons uses the cost method of accounting for treasury stock c On April 8, 2005, Lyons issued 50,000 shares of previously unissued common stoc for $600,000. such common stock s common stock at a price of d. On November 10, 2005, Lyons sold 4,000 shares of treasury stock for $10 per share 6. Net income for the year ended December 31, 2005, was $748,000. f. The company experienced a holding loss of $45,000 net of taxes on its available for sale securities during 2005. & On December 31, 2005, the board of directors declared the yearly cash dividend on the preferred stock, payable on January 15, 2006, to stockholders of record as of De- cember 31, 2005. The board of directors also declared a cash dividend of $0.20 per share on the common stock, payable on January 15, 2006, to stockholders of record as of December 31, 2005. Required: a. Prepare a statement of changes in stockholders' equity for the year ended Deco 31, 2005, in good form. b. Prepare the stockholders' equity section of the balance sheet at December 31, in good form. for the year ended December neet at December 31, 2005