Question
The Stockholders Equity section of the Balance Sheet of Carpenter Corporation on December 31, 2015, showed Cumulative Preferred 8% Stock, $53 par (1,182 shares authorized,
The Stockholders Equity section of the Balance Sheet of Carpenter Corporation on December 31, 2015, showed Cumulative Preferred 8% Stock, $53 par (1,182 shares authorized, 307 shares issued); Common Stock, $22 par (25,075 shares authorized, 13,808 shares issued); and Retained Earnings of $1,058. The Notes to the Financial Statements in the Annual Corporate Report for 2015 indicate that the market values of the stock are $42 per share (Cumulative Preferred) and $18 per share (Common). Forecasts in the Annual Report also indicate that investments in future growth in 2016 are expected to result in sustained increased profits. In consideration of these matters, the Board of Directors has secured approval from the Securities and Exchange Commission for a bond issuance. The Board of Directors has also decided to forego paying dividends in 2015, and to repurchase shares of the corporations common stock at par, with a view to reselling the stock when market rates rise with increased profitability. On January 2, 2016, $241,052 in 11 year, 7% bonds with a market interest rate of 9%, and interest payable semiannually, were issued for $188,952. On January 3, the corporation purchased 1,924 shares of its common stock at par. Profits soared during 2016, and on May 1, the corporation resold 1,596 shares of treasury stock, at $5 above par. On June 30, bond interest was paid. On December 31, the corporation showed an after tax Net Income of $52,097. On December 31, bond interest was paid; and dividends were declared and paid. Common shareholders received $2.15 per share. What is the Total Stockholders Equity on the Balance Sheet on December 31, 2016?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started