Question

The following information pertains to JAE Corp. at January 1, 2018:

Common stock, $11 par, 12,000 shares authorized, 2,400 shares issued and outstanding: $26,400
Paid-in capital in excess of par, common stock 16,700
Retained earnings 74,600

JAE Corp. completed the following transactions during 2018:

Issued 1,200 shares of $11 par common stock for $29 per share.
Repurchased 230 shares of its own common stock for $26 per share.
Resold 50 shares of treasury stock for $27 per share.

Required:
a. How many shares of common stock were outstanding at the end of the period?
b. How many shares of common stock had been issued at the end of the period?
c. Organize the transactions data in accounts under the accounting equation.
d. Prepare the stockholders' equity section Of the balance sheet reflecting these transactions. Include the number Of shares authorized, issued, and outstanding in the description of the common stock.

Answer 1

Answer and Explanation:

According to the scenario, computation of the given data are as follow:-

a. At The End of Period Outstanding Shares = Issue Share + Beginning Shares + Resold Share - Repurchase Share

= 1,200 + 2,400 + 50 - 230

= 3,420 Shares

B) Issued Shares = Issued Shares + Beginning Shares

= 1,200 + 2,400

= 3,600 Shares

c. The c part is shown in the excel spreadsheet kindly find it below.

d).                Balance Sheet  

Particular        Amount ($)

Common stock $25,200

PIC in excess of treasury stock $50

PIC in excess of common stock $38,300

Retained earnings $74,600

Less-treasury stock -$4,680

Total equity of stockholder $133,470