Question

How much treasury stock w 5. What was the amount of relate solely to ce per share 0. What was the amount of long 7. Assume the increas the sale of common stock during of common stock? 8. What was the networking clip stock was sold du For money raised by selling nt of long-term debt borrowed during 20x2? cretses in common stock and additional paid-in capital relate ring 20x2. What was the average selling price pe working capital at the end of 20x2? 9. What amount of div amount of dividends were paid during 20XZ? 10. What was the net income for 20X2 Problem 16 sked for your help Ms. Bush, the owner of The Bush, the owner of The Texan a small hospitality operation, has asked for you th understanding the balance sheets for 20X1 and 20X2. She is able to present you with condensed balance sheet as follows: The Texan Condensed Balance Sheets December 31, 20X1 and 20X2 20X1 2 0X2 $ 10,000 Accounts receivable 126,500 Investments (long-term) Cash 10,000 800,000 (20,000) $ 926,500 5,000 118,500 25,000 925,000 (64,000) $1,009,500 $ $ Equipment Accumulated depreciation Total Assets Current liabilities: Accounts payable Note payable (current) Dividends payable Noncurrent liabilities: Note payable Common Stock Paid-in capital in excess of par Treasury stock Retained earings 18,000 25,000 5,000 21,000 42,000 6,000 675,000 100,000 70,000 (20,000) 53,500 $ 926,500 690,000 105,000 95,000 (30,000) 80,500 $1,009,500 Total Liabilities and Owners' Equity Additional Information: a. Assume equipment costing $25,000 and depreciated down to $10,000 was sold for $12,000 during 20x2. b. Assume all current liabilities at the end of the year are paid during the following year. c. Assume retained earings is impacted only by declaration of dividends during the year and net earnings for the year.

i need help answering questions #7 through #11

Answer 1

7.
Issue of shares ($) = Change in Common Stock + Change in Paid in capital in excess of par
= ($105000 - $100000) + ($95000 - $70000) = $30000

Selling price per share = $30000/10000 = $3 per share

8.
Funds borrowed during the year = $690000 - $675000 + $42000 - $25000 = $32000

9.
Book Value of asset sold = $25000 - $10000 = $15000
Since it is sold for $12000 i.e. lower than book value, it is loss on sale
Loss on sale of Equipment = $15000 - $12000 = $3000

10.
Purchase of Equipment = $925000 - ($800000-25000) = $150000

11.
Depreciation Expense = $64000 - ($20000 - $10000) = $54000