Question

Kinkaid Co. is incorporated at the beginning of this year and engages in a number of...

Kinkaid Co. is incorporated at the beginning of this year and engages in a number of transactions. The following journal entries impacted its stockholders’ equity during its first year of operations.

General Journal Debit Credit
a. Cash 280,000
Common Stock, $25 Par Value 250,000
Paid-In Capital in Excess of Par Value, Common Stock 30,000
b. Organization Expenses 180,000
Common Stock, $25 Par Value 130,000
Paid-In Capital in Excess of Par Value, Common Stock 50,000
c. Cash 45,500
Accounts Receivable 18,000
Building 82,700
Notes Payable 59,600
Common Stock, $25 Par Value 56,600
Paid-In Capital in Excess of Par Value, Common Stock 30,000
d. Cash 127,000
Common Stock, $25 Par Value 76,000
Paid-In Capital in Excess of Par Value, Common Stock 51,000


Required:
2. How many shares of common stock are outstanding at year-end?
3. What is the amount of minimum legal capital (based on par value) at year-end?
4. What is the total paid-in capital at year-end?
5. What is the book value per share of the common stock at year-end if total paid-in capital plus retained earnings equals $793,000?

How many shares of common stock are outstanding at year-end? What is the amount of minimum legal capital (based on par value) at year-end? What is the total paid-in capital at year-end?

2. Number of outstanding shares
3. Minimum legal capital
4. Total paid-in capital

What is the book value per share of the common stock at year-end if total paid-in capital plus retained earnings equals $793,000?

Book Value per Common Share
Choose Numerator: / Choose Denominator: = Book Value per Common Share
/ = Book value per common share
/ =
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Homework Answers

Answer #1

Answer :-

2)

Calculation of Total Shares Outstanding

= (250,000 + 130,000 + 56,600+76,000) / 25

= 20,504 Shares.

3)

Minimum Legal Capital at the year end

= No.of shares Outstanding x par value

= 20,504 x 25

= 512,600.

4)

Total Paid in Capital at the year End  

= ( Minimum legal capital + excess paid in capital)

= 512,600 + 30,000 + 50,000 + 30,000 + 51,000

= 673,600.

5)

Book Value per share

  = ( Total paid in capital + Retained Earnings ) / No. Of shares Outstanding

= 793,000 / 20,504

=    38.67538.

  

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