The following account balances appear on the books of World Corporation as of December 31, 2003: Preferred

The following account balances appear on the books of World Corporation as of December 31, 2003:

Transcribed Image Text:

Preferred stock (7%, $40 par, 70,000 shares authorized, 50,000 shares issued and outstanding).. Common stock ($3 par, 500,000 shares authorized, 300,000 shares issued and outstanding). Paid-in capital in excess of par, preferred stock. Paid-in capital in excess of par, common stock Net income for 2003.. Dividends paid during 2003. Retained earnings, January 1, 2003. $2,000,000 900,000 310,000 490,000 130,000 70,000 1,360,000 1. If the preferred stock is selling at $45 per share, what is the maximum amount of cash that World Corporation can obtain by issuing additional preferred stock given the sent number of authorized shares? pre- 2. If common stock is selling for $12 per share, what is the maximum amount of cash that can be obtained by issuing additional common stock given the present number of autho- rized shares? 3. Given the account balances at December 31, 2003, and ignoring parts (1) and (2), pre- pare, in good form, the stockholders' equity section of the balance sheet.