The following information pertains to MGM Corp. at January 1, 2013: Common stock , $10 par, 20,000

Question:

The following information pertains to MGM Corp. at January 1, 2013:

Common stock, $10 par, 20,000 shares authorized,

1,000 shares issued and outstanding ...........$10,000

Paid-in capital in excess of par, common stock ....... 15,000

Retained earnings ................. 82,000

MGM Corp. completed the following transactions during 2013:

1. Issued 3,000 shares of $10 par common stock for $35 per share.

2. Repurchased 500 shares of its own common stock for $38 per share.

3. Resold 200 shares of treasury stock for $40 per share.

Required

a. How many shares of common stock were outstanding at the end of the period?

b. How many shares of common stock had been issued at the end of the period?

c. Prepare journal entries for these transactions and post them to T-accounts.

d. Prepare the stockholders’ equity section of the balance sheet reflecting these transactions. Include the number of shares authorized, issued, and outstanding in the description of the common stock.

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...