Reference no: EM132490684

The shareholders' equity section of the balance sheet of The Claremont Company appeared as follows at the end of the first year of operations:

Common stock,            $0.08 par value  $480,000

Additional paid-in-capital 71,520,000

Retained earnings          25,600,000

Treasury stock(6,000,000)

Shareholders' equity$91,600,000

During the second year of operations, the following transactions occurred:

1. Generated net income of $4.8 million.
2. Paid a cash dividend of $1.2 million.
3. Purchased 100,000 shares of common stock at $7.6 per share.
4. Executed a 1-for-2 reverse stock split.

Question 1: Prepare the shareholders' equity section of the balance sheet of Claremont Company at the end of the second year of operations