Question

At December 31, the records of Nortech Corporation provided the following selected and incomplete data: Common...

At December 31, the records of Nortech Corporation provided the following selected and incomplete data:

Common stock (par $1; no changes during the current year).
Shares authorized, 500,000.
Shares issued, ?; issue price $31 per share.
Common Stock account, $290,000.
Shares held as treasury stock, 3,900 shares, cost $24 per share.
Net income for the current year, $343,320.
Dividends declared and paid during the current year, $97,274.
Retained Earnings balance, beginning of the year, $164,000.

Required:

Complete the following: TIP: To determine the number of shares issued, divide the balance in the Common Stock account by the par value per share. (Round "per share" answers to 2 decimal places.)

Business   Accounting   
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Answer #1
Answer

1-a) Shares Authorized = 500000.
1-b) Shares issued = 290000 / 1 = 290000 Shares issued
1-c) Shares Outstanding = 290000 - 3900 = 286900 Shares Outstanding.
2) The Balance in additional paid-in capital account = 290000 * (31 - 1) = $ 8700000.
3) Earning per share = Net income / Shares outstanding = 343320 / 286900 = 1.20 Per Share
4) Dividend paid per share of common stock = 97274 / 286900 = 0.34 Per Share
5) The amount for which treasury stock should be reported in the stockholders' equity section of the Balance Sheet = 3900 * 24 = $ 93600
6) After the stock split, the par value per share = 1 / 2 = $ 0.50 Per Share
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