7.Canton Corporation shareholders' equity section of its balance sheet as of December 31, 2009 is as follows:
Common stock, $5 par value; 40,000 shares authorized
|
$50,000
|
Additional paid-in capital
|
100,000
|
Retained earnings
|
180,000
|
Total
|
$330,000
|
The following events occurred during 2010:
March 3 - 5,000 shares of authorized and unissued common stock were sold for $22 per share.
March 16 - Declared a cash dividend of $3 per share payable May 15 to holders of record on May 5.
A.At March 31, 2010, how many more shares of stock can be issued?
B.At March 31, 2010, how many shares are issued and outstanding?
8.If an investor owns 8% of a corporation prior to a 2-for-1 stock split, what percentage does the investor own after receiving 2 shares of $5 par value stock for each $10 par value share of stock?
9.The shareholders' equity section of Campbell Co.’s balance sheet follows:
Common stock, $2 par
|
$ 80,000
|
Additional paid-in capital – common
|
50,000
|
Additional paid-in capital—treasury stock
|
600
|
Retained earnings
|
25,400
|
Treasury stock
|
(2,000)
|
Total shareholders' equity
|
$154,000
|
A.Assumeall of the treasury stock was sold for $4,800. Calculate the following amounts:
1. Additional paid-in capital—treasury stock
2. Retained earnings
3. Total shareholders' equity
B.Assumeall of the treasury stock was sold for $850. Calculate the following amounts:
1. Additional paid-in capital—treasury stock
2. Retained earnings
3. Total shareholders' equity
10.Immediately before Cavecreek Corporation purchased 4,000 shares of its own common stock for $25 a share, it had total liabilities of $200,000 and total shareholders' equity of $520,000. Calculate Cavecreek’s debt/equity ratio immediately subsequent to the purchase of the treasury stock.
11.Immediately before Zorro Corporation sold 4,000 shares of its own common stock for $30 a share, it had total liabilities of $200,000 and total shareholders' equity of $520,000. Determine Zorro’s debt/equity ratio immediately subsequent to the stock issue.
12.Immediately before Cayman Corporation issued 2,000 shares of its common stock for $15 a share, it had total liabilities of $150,000 and total shareholders' equity of $300,000. Cayman had 10,000 shares of common stock outstanding prior to the new issuance. Calculate Cayman’s debt/equity ratio immediately after the new issuance.