Reference no: EM132753368

Question - The Shareholder's Equity accounts of a corporation on January 1, 2019 are as follows:

Preferred Stock (10%, $130 par, cumulative, 2,000 shares authorized) - $195,000

Common Stock ($5 par, 120,000 shares authorized) - $400,000

APIC Preferred - $20,000

APIC Common - $600,000

Retained Earnings - $800,000

Treasury Stock Common ($15 cost) - $18,000

During 2019, the corporation had the following transactions and events relating to its shareholder's equity. Please update the shareholder's equity accounts based on the information below and answer the following five questions.

January 6 - Issued 10,000 shares of common stock. On this date, the stock was trading for $13 per share.

March 21 - Sold 1,000 shares of Treasury Stock - Common for $18 per share.

December 12 - Purchased 3,000 shares of common stock for the treasury at a cost of $45,000.

December 31 - Determined that Net Income for the year was $218,000. Dividends were declared and paid during December. These dividends included dividends to preferred shareholders, plus a $0.10 per share dividend to common stockholders of record as of December 20. There were no dividends in arrears.

Q1. What is the total amount of dividends paid to preferred shareholders in December?

$19,500

$26,000

$1,500

$2,000

$195,000

Q2. What is the Retained Earnings balance as of December 31, 2019?

$989,820

$989,500

$983,000

$990,620

$990,500

Q3. What is total Shareholder's Equity as of December 31, 2019?

$2,337,820

$2,347,820

$2,289,820

$2,195,500

$2,287,500