Accounting: What the Numbers Mean 9th Edition by Wayne W McManus, Daniel F Viele, David H Marshall

Exercise 11

Common stock balance sheet disclosure The balance sheet caption for common stock is the following:

Common stock, $5 par value, 2,000,000 shares authorized,
1,400,000 shares issued, 1,250,000 shares outstanding	$	?

Required:

a. Calculate the dollar amount that will be presented opposite this caption.

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b. Calculate the total amount of a cash dividend of $.15 per share.

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c. What accounts for the difference between issued shares and outstanding shares?

Step 1 of 3

Common stock balance sheet disclosure:

Common stock authorized 2,000,000 shares authorized

Shares issued 1,400,000 shares

Shares outstanding 1,250,000 shares

Par value $5 per share

The balance sheet caption for common stock is as follows:

Balance sheet caption for common stock is as follows:
Stockholders ‘equity
Paid in Capital:
Common stock $5 par value, 2,000,000 shares authorized
1,400,000 shares issued, 1,250,000 shares outstanding	$6,250,000

a.

Calculate the share capital amount recorded in the balance sheet is as follows:

Therefore, the share capital amount recorded in the balance sheet is.