Question

Cheyenne Company reported the following amounts in the stockholders' equity section of its December 31, 2016, balance sheet. | Preferred stock, 10%, $100 par (10,000 shares authorized, 1,800 shares issued) $180,000 Common stock, $5 par (103,500 shares authorized, 20,700 shares issued) Additional paid-in capital Retained earnings 103,500 114,000 423,000 $820,500 Total During 2017, Cheyenne took part in the following transactions concerning stockholders' equity 1. Paid the annual 2016 $10 per share dividend on preferred stock and a $2 per share dividend on common stock. These dividends had been declared on December 31, 2016 2. Purchased 1,500 shares of its own outstanding common stock for $43 per share. Cheyenne uses the cost method 3. Reissued 600 treasury shares for land valued at $27,100. 4. Issued 550 shares of preferred stock at $105 per share. 5. Declared a 10% stock dividend on the outstanding common stock when the stock is selling for $41 per share. 6. Issued the stock dividend 7. Declared the annual 2017 $10 per share dividend on preferred stock and the $2 per share dividend on common stock. These dividends are payable in 2018

Answer 1

Solution:

Cheyenne Company
Stockholder's Equity
For the Year Ended December 31, 2017
Particulars	Amount
Stockholder's Equity
Preferred stock (2350*$100)	$235,000.00
Common stock (20700*110%*$5)	$113,850.00
Paid in capital	$348,850.00
Additional paid in capital ($114,000 + 550*$5 + $1,300 + 2070*$36)	$192,570.00
Contributed capital	$541,420.00
Retained earnings ($423,000 - 2070*41 - 2350*$10 - 22770*$2)	$269,090.00
Stockholder's equity before treasury stock	$810,510.00
Less: Treasury stock (900*$43)	$38,700.00
Stockholder's Equity	$771,810.00