Reference no: EM132585286
The shareholders' equity section of Superior Corporation's balance sheet as of December 31, 2015, is as follows:
Shareholders' Equity
Preferred stock, $100 par value; authorized, 300,000 shares; issued, 30,000 shares $3,000,000
Common stock, $5 par value; authorized, 2,000,000 shares; issued, 400,000 shares $2,000,000
Paid-in capital in excess of par-preferred 90,000
Paid-in capital in excess of par-common 850,000
Retained earnings 3,000,000
$8,940,000
The following events occurred during 2016:
Jan. 5 10,000 shares of authorized and unissued common stock were sold for $8 per share.
Jan 16. 10,000 shares of authorized and unissued preferred stock were sold for $109 per share.
Apr. 1 80,000 shares of common stock were repurchased for the treasury at a price of $19 per share. Superior uses the cost method to account for treasury stock.
Sept. 1 3,000 shares of preferred stock are issued in exchange for a piece of land. The land has an appraised value of $336,000. The preferred stock currently trades on the New York Stock Exchange at a price of $109 per share.
Dec. 1 25,000 shares of treasury stock are reissued at a price of $24 per share.
Question 1: Calculate Superior's legal capital at December 31, 2016