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[The following information applies to the questions displayed below.] National League Gear has two classes of stock authorized: 6%, $20 par preferred, and $5 par
[The following information applies to the questions displayed below.]
National League Gear has two classes of stock authorized: 6%, $20 par preferred, and $5 par value common. The following transactions affect stockholders equity during 2024, National Leagues first year of operations:
February 2 | Issue 1.3 million shares of common stock for $17 per share. |
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February 4 | Issue 420,000 shares of preferred stock for $22 per share. |
June 15 | Purchase 130,000 shares of its own common stock for $12 per share. |
August 15 | Resell 97,500 shares of treasury stock for $27 per share. |
November 1 | Declare a cash dividend on its common stock of $1.30 per share and a $504,000 (6% of par value) cash dividend on its preferred stock payable to all stockholders of record on November 15. (Hint: Dividends are not paid on treasury stock.) |
November 30 | Pay the dividends declared on November 1. |
2. Prepare the stockholders equity section of the balance sheet as of December 31, 2024. Net income for the year was $4,720,000. (Amounts to be deducted should be indicated by a minus sign.)
National League Gear Balance Sheet (Stockholders' Equity Section) December 31, 2024 Stockholders' Equity: \begin{tabular}{|l|l|} \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline Total Paid-in Capital & \\ \hline & \\ \hline & \\ \hline & \\ \hline Total Stockholders' Equity & \\ \hline \end{tabular}
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