Question

On January 1, 2022, Sage Hill Inc. had these stockholders’ equity balances.

Common Stock, $1 par (2,500,000 shares authorized, 650,000 shares issued and outstanding)		$650,000
Paid-in Capital in Excess of Par Value		1,420,000
Retained Earnings		698,000
Accumulated Other Comprehensive Income		50,000

During 2022, the following transactions and events occurred.

1.		Issued 46,500 shares of $1 par value common stock for $2 per share.
2.		Issued 61,000 shares of common stock for cash at $6 per share.
3.		Purchased 22,500 shares of common stock for the treasury at $3.05 per share.
4.		Declared and paid a cash dividend of $205,500.
5.		Earned net income of $422,000.
6.		Had other comprehensive income of $15,800.

Prepare the stockholders’ equity section of the balance sheet at December 31, 2022.

Answer 1

SAGE HILL INC
Partial balance sheet
stockholders' equity
paid in capital
common stock						757500
additional paid in capital
paid in capital in excess of par value -common stock						279000
total paid in capital						1036500
Retained earnings						914500
total paid in capital & retained earning						1951000
Other comprehensive income						65800
less:treasury stock (22500*3.05)						-68625
total stockholder equity						1948175
Working
common stock (650000+46500+61000)*1 = 757500
Paid in capital in excess of par (1420000+46500*1+61000*5)=279000
Retained earnings (698000+422000-205500) = 914500
other coprehensive income (50000+15800) = 65800

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