1. Business
  2. Accounting
  3. sheffield company has two classes of capital stock outstanding 7...

Question: sheffield company has two classes of capital stock outstanding 7...

Question details

Sheffield Company has two classes of capital stock outstanding: 7%, $100 par preferred and $2 par common. At December 31, 2017, the following accounts were included in stockholders’ equity.

Preferred Stock, 50,000 shares $ 5,000,000
Common stock, 1,200,000 shares 2,400,000
Paid-in Capital in Excess of Par – Preferred Stock 300,000
Paid-in Capital in Excess of Par – Common Stock 28,800,000
Retained Earnings 12,800,000


The following transactions affected stockholders’ equity during 2018.

Jan. 1 - 500 shares of preferred stock issued at $ 108 per share.
Mar. 21 - 110,000 shares of common stock issued at $ 40 per share.
June 1 - 2-for-1 common stock split (par value reduced to $1).
July 15 - 77,000 shares of common treasury stock purchased at $ 32 per share. Sheffield uses the cost method.
Sept. 4 - 9,000 shares of treasury stock reissued at $ 38 per share.
Dec. 31 - The preferred dividend is declared, and a common dividend of 68¢ per share is declared.
Dec. 31 - Net income is $ 4,587,000.


Prepare the stockholders’ equity section for Hatch Company at December 31, 2018.

Solution by an expert tutor
Blurred Solution
This question has been solved
Subscribe to see this solution