Poodle Corporation was organized on January 3, 2021. The firm was authorized to issue 98,000 shares of $5 par common stock. During 2021, Poodle had the following transactions relating to shareholders' equity: Issued 35,000 shares of common stock at $5.40 per share. Issued 23,000 shares of common stock at $9.60 per share. Reported net income of $101,000. Paid dividends of $57,000. What is total paid-in capital at the end of 2021?

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hyderali230 hyderali230 · Answer 1 · 2020-04-22T06:49:23+02:00

Answer:

$409,800

Explanation:

Paid-in-Capital is the sum of The par value and the value excess of par paid by the stockholders on the issuance of stock.

35,000 Share issue

Common Stock at par = 35,000 shares x $5 = $175,000

Paid-in-Capital Excess of Par Common Shares = 35,000 shares x ($5.4 - $5 ) = $14,000

23,000 Share issue

Common Stock at par = 23,000 shares x $5 = $115,000

Paid-in-Capital Excess of Par Common Shares = 23,000 shares x ($9.6 - $5 ) = $105,800

Total = ( 35,000 x $5.4 ) + ( 23,000 x $9.6 ) = $189,000 + $220,800 = $409,800