The balance sheet of Harris Hats, Inc , included the following shareholders equity accounts at December 31, 2020 Paid in Capital Preferred stock, $10 par, 10 , 90,000 shares authorized, 70,000 shares issued and outstanding $700,000 Common Stock, $1 par, 2,000,000 shares authorized, 364,000 shares issued 364,000 APIC PS 5,600,000 APIC CS 5,096,000 Total Paid in Capital $11,760,000 Retained Earnings 6,782,350 Treasury stock, 4,000 shares at cost (48,000) Total Shareholders Equity $18,494,350 During 2021, the following events and transactions occurred On February 2nd, the board of directors declared a property dividend of 150,000 shares of Dawson Corporation common stock that Harris had purchased in January as an investment with a cost basis of $750,000 The investment shares had a fair value of $6 per share and were distributed February 28 th to shareholders of record February 15 th On March 15 th , a 3 for 1 stock split was declared and distributed The stock split was effected in the form of a stock dividend The market value of the $1 par common stock was $14 per share On July 5 th , a 4 common stock dividend was declared and distributed The market value of the common stock was $13 per share On December 1 st , the board of directors declared the annual cash dividend of 10 on the 70,000 preferred shares, payable on December 28 th to shareholders of record December 20 th On December 1 st , the board of directors declared a cash dividend of $0 25 per share on its common shares, payable on December 28 th to shareholders of record December 20 th On December 29 th, the company reacquired 12,000 shares of common stock at a price of $12 per share Net income for the year was $1,205,000 Prepare the shareholders' equity section of the balance sheet for Harris Hats, Inc, at December 31, 2021 in good form Make sure to appropriate title and order the information (Please show your work You are not required to prepare the journal entries, but if that helps you please submit the journal entries and or scratch work T accounts for partial credit)

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Jul 11, 2024

The balance sheet of Harris Hats, Inc., included the following shareholders equity accounts at December 31, 2020: Paid in Capital: Preferred stock, $10 par, 10%,

The balance sheet of Harris Hats, Inc., included the following shareholders equity accounts at December 31, 2020:

Paid in Capital:
Preferred stock, $10 par, 10%, 90,000 shares authorized, 70,000 shares issued and outstanding	$700,000
Common Stock, $1 par, 2,000,000 shares authorized, 364,000 shares issued	364,000
APIC-PS	5,600,000
APIC-CS	5,096,000
Total Paid in Capital	$11,760,000
Retained Earnings	6,782,350
Treasury stock, 4,000 shares at cost	(48,000)
Total Shareholders Equity	$18,494,350

During 2021, the following events and transactions occurred:

On February 2nd, the board of directors declared a property dividend of 150,000 shares of Dawson Corporation common stock that Harris had purchased in January as an investment with a cost basis of $750,000. The investment shares had a fair value of $6 per share and were distributed February 28^th to shareholders of record February 15^th.
On March 15^th, a 3-for-1 stock split was declared and distributed. The stock split was effected in the form of a stock dividend. The market value of the $1 par common stock was $14 per share.
On July 5^th, a 4% common stock dividend was declared and distributed. The market value of the common stock was $13 per share.
On December 1^st, the board of directors declared the annual cash dividend of 10% on the 70,000 preferred shares, payable on December 28^th to shareholders of record December 20^th.
On December 1^st, the board of directors declared a cash dividend of $0.25 per share on its common shares, payable on December 28^th to shareholders of record December 20^th.
On December 29^th, the company reacquired 12,000 shares of common stock at a price of $12 per share.
Net income for the year was $1,205,000.

Prepare the shareholders' equity section of the balance sheet for Harris Hats, Inc, at December 31, 2021 in good form. Make sure to appropriate title and order the information. (Please show your work. You are not required to prepare the journal entries, but if that helps you please submit the journal entries and/or scratch work/T-accounts for partial credit)