A company has the following balances in its stockholders' equity accounts on December 31, Year 1: Treasury Stock, $660,000; Common Stock, $410,000; Preferred Stock, $1,700,000; Retained Earnings, $1,250,000; and Additional Paid-in Capital, $6,900,000. Required: Prepare the stockholders' equity section of the balance sheet for the company as of December 31, Year 1. (Amounts to be deducted should be indicated by a minus sign.)

Question

Urijah Hayden

Business

19 July, 03:16

A company has the following balances in its stockholders' equity accounts on December 31, Year 1: Treasury Stock, $660,000; Common Stock, $410,000; Preferred Stock, $1,700,000; Retained Earnings, $1,250,000; and Additional Paid-in Capital, $6,900,000. Required: Prepare the stockholders' equity section of the balance sheet for the company as of December 31, Year 1. (Amounts to be deducted should be indicated by a minus sign.)

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Maeve Mckenzie · Answer 1

Answer and Explanation:

The preparation of the stockholders' equity section of the balance sheet for the company is shown below:

Common stock $410,000

Add: Preferred stock $1,700,000

Add: Retained earnings $1,250,000

Add: Additional paid in capital $6,900,000

Less: treasury stock - $660,000

Total amount $9,600,000

We simply added the all the items except the treasury stock as it is to be deducted and the same is shown above