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The authorized share capital of the Alfred Cake Company is 110,000 shares. The equity is currently shown in the company's books as follows: COMMON STOCK
The authorized share capital of the Alfred Cake Company is 110,000 shares. The equity is currently shown in the company's books as follows: COMMON STOCK ($2 par value) =$79,000: ADDITIONAL PAID-IN CAPITAL = $29,000: RETAINED EARNINGS = $49,000 AND ALL TOTAL TOGETHER IS $157,000: COMMON EQUITY, TREASURY STOCK (4,000 shares) =$23,000 and Net Common Equity is $134000. (a). Suppose that the company issues 29,000 shares at $5 a share. Construct the revised equity accounts Common stock $______; additional paid-in capital $_______; Retained earnings $_________; Common equity $________; Treasury stock $_______; and Net common equity $_______. (b) What would happen to the company's books if instead it bought back 11,000 shares at $5 per share? Construct the revised equity accounts. Common stock $_________; Additional paid-in capital $_________, Retained earnings $_________; Common Equity $______, Treasury stock $________ and Net common equity $______
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