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At December 31, the records of Nortech Corporation provided the following selected and incomplete data:Common stock (par $1; no changes during the current year).Shares authorized, 500,000.Shares issued, ?; issue price $22 per share.Common Stock account, $200,000.Shares held as treasury stock, 3,000 shares, cost $20 per share.Net income for the current year, $147,750.Dividends declared and paid during the current year, $49,250.Retained Earnings balance, beginning of the year, $155,000.Required:Complete the following: TIP: To determine the number of shares issued, divide the balance in the Common Stock account by the par value per share. (Round "per share" answers to 2 decimal places.)

Respuesta :

tanseershar

Answer:

The following balances have been worked out from the information given in question;

Explanation:

No. of Common stocks issued     $200,000/22         9,091

Paid in capital-Common Stocks               9,091*(22-1)  $90,909      

No. of Treasury Stock                                                         3,000

Treasury stock            3,000*20                                         $60,000      

EPS   =$147,750/(9,091 -3,000)                                          $24

Retained Earnings ($155,000+$147,750-$49,250)           $253,500

                                                 

anthougo

The Equity Section of the Nortech Corporation's Balance Sheet is as follows:

Common Stock:

500,000 shares, Authorized at $1 par value

200,000 Issued Shares at $1 = $200,000

Additional Paid-in Capital          4,143,000

3,000 shares, Treasury stock        (3,000)

Retained Earnings                       253,500

Total Equity                           $4,593,500

1c. Shares Outstanding = 197,000 (200,000 - 3,000)

2. Balance in Additional Paid-in Capital = $4,143,000

3. Earnings per share = $0.75 ($147,750/197,000)

4. Dividend per share = $0.25 ($49,250/197,000)

5. The Treasury stock is reported as $3,000 on the balance sheet.

6. With a 2-for-1 stock split, the par value becomes $0.50 ($1/2)

Data and Calculations:

Par value of Common Stock = $1

Authorized Shares = 500,000 shares

Issue price per share = $22

Common Stock Account = $200,000

Issued Shares = 200,000 shares ($200,000/$1)

Treasury Stock = $3,000 (3,000 x $1)

Additional Paid-in Capital = $4,200,000 (200,000 x $21)

Additional Paid-in Capital (Treasury Stock) = $57,000 ($19 x 3,000)

Balance of Additional Paid-in Capital = $4,143,000 ($4,200,000 - $57,000)

Retained earnings for the year:

Beginning Balance $155,000

Net income                147,750

Dividends paid         (49,250)

Ending Balance    $253,500

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