Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The Stockholders' Equity section of the Balance Sheet of Carpenter Corporation on December 31, 2019, showed Cumulative Preferred8% Stock, $47par (1,884shares authorized,500shares issued); Common Stock,

The Stockholders' Equity section of the Balance Sheet of Carpenter Corporation on December 31, 2019, showed Cumulative Preferred8% Stock, $47par (1,884shares authorized,500shares issued); Common Stock, $22par (29,405shares authorized,9,068shares issued); and Retained Earnings of $1,042.The Notes to the Financial Statements in the Annual Corporate Report for 2019 indicate that the market values of the stock are $42per share (Cumulative Preferred) and $18per share (Common).Forecasts in the Annual Report also indicate that investments in future growth in 2020 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 2019, and to repurchase shares of the corporation's common stock at par, with a view to reselling the stock when market rates rise with increased profitability.

On January 2, 2020, $218,372in10year,7% bonds with a market interest rate of9%, and interest payable semiannually, were issued for $185,044.On January 3, the corporation purchased2,051shares of its common stock at par.Profits soared during 2020, and on May 1, the corporation resold1,515shares of treasury stock, at $9above par.On June 30, bond interest was paid.On December 31, the corporation showed an after tax Net Income of $57,286.On December 31, bond interest was paid; and dividends were declared and paid.Common shareholders received $2.34per share.

What is theTotal Stockholders' Equity on the Balance Sheeton December 31, 2020?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Managerial Accounting For Dummies

Authors: Mark P Holtzman, Karen Schoenebeck

1st Edition

1118116429, 978-1118116425

More Books

Students also viewed these Accounting questions

Question

Briefly discuss Aristotles approach to dreaming.

Answered: 1 week ago

Question

Why should a business be socially responsible?

Answered: 1 week ago

Question

Discuss the general principles of management given by Henri Fayol

Answered: 1 week ago

Question

Detailed note on the contributions of F.W.Taylor

Answered: 1 week ago