Question

Stockholders' Equity: Transactions and Balance Sheet Presentation The stockholders' equity accounts of Willis Corporation at January 1 appear below: 8 Percent preferred stock, $10 par value, 50,000 shares authorized; 6,800 shares issued and outstanding $68,000 Common stock, $10 par value, 200,000 shares authorized; 50,000 shares issued and outstanding 500,000 Paid-in capital in excess of par value-Preferred stock 68,000 Paid-in capital in excess of par value-Common stock 200,000 Retained earnings 270,000 During the year, the following transactions occurred: Jan. 10 Issued 35,000 shares of common stock for $18 cash per share. 23 Purchased 10,000 shares of common stock as treasury stock at $19 per share. Mar. 14 Sold one-half of the treasury shares acquired January 23 for $21 per share. July 15 Issued 3,500 shares of preferred stock in exchange for equipment with a fair market value of $128,000. Nov. 15 Sold 1,000 of the treasury shares acquired January 23 for $24 per share. Dec. 31 Closed the net income of $59,000 to the Retained Earnings account.

Answer 1

Preparation of Stockholders' Equity Section: Stockholders' Equity Paid in Capital: $ Preferred Stock 103,000.00 $ Common Stock 850,000.00 $ 953,000.00 Additional Paid in Capital: Paid in Capital in Excess of Par Value - Preferred Stock $ 161,000.00 Paid in Capital in Excess of Par Value - $ $ Common Stock 480,000.00 Paid in Capital from Treasury Stock Total Paid in Capital Retained Earnings 656,000.00 1,609,000.00 $ 15,000.00 $ 329,000.00 1,938,000.00 $ Less: Treasury Stock - Common Total Stockholders' Equity (76,000.00) $1,862,000.00