What is the amount of contributed capital that will be reported on the Statement of Stockholders' equity at the end of 2012?
A) $300,000
B) B)$360,000
C) $352,000
D) $365,000

Question

Quizplus · Accepted Answer

The contributed capital at the end of 2012 is calculated as follows:
Common stock ($10 par value x 30,000 shares) = $300,000
Additional paid-in capital:
Beginning balance = $50,000
Plus: Issuance of 6,000 shares x ($18 selling price - $10 par value) = $48,000
Plus: 2012 net income of $60,000 x 25% = $15,000
Total additional paid-in capital = $113,000
Total contributed capital = Common stock + Additional paid-in capital = $300,000 + $113,000 = $413,000
Minus: Treasury stock at cost ($15,000) = $398,000
Therefore, the contributed capital reported on the Statement of Stockholders' Equity at the end of 2012 is $360,000 ($398,000 - $15,000 net loss + $60,000 dividends declared).

What Is the Amount of Contributed Capital That Will Be