Use the data from E8-46B to prepare the shareholders equity section of the balance sheet at May

Question:

Use the data from E8-46B to prepare the shareholders’ equity section of the balance sheet at May 31. Retained earnings at month-end are $105,000.

In E8-46B, Minute Magazine Publications, Inc., is authorized to issue both preferred and common stock. Minute Magazine’s preferred stock is $155 par, 10% preferred stock. During the first month of operations, the company engaged in the following transactions related to its stock. For each of the following transactions, show how it would be recorded in the accounting equation:

May 1Issued 50,000 shares of $1.00 par value common stock for cash at $12 per share

May 9Issued 2,000 shares of preferred stock at par

May 17 Purchased 2,500 shares of common stock to be held in the treasury for $15 per share

May 21 Issued 35,000 shares $1.00 par value common stock for cash at $18 per share

May 28 Sold 2,000 shares of the treasury stock purchased on the 17th for $20 per share

May 31 Declared a $39,000 dividend

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... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...