Question

Problem 15-12

Bonita Company was formed on July 1, 2015. It was authorized to issue 298,000 shares of $10 par value common stock and 102,100 shares of 8% $25 par value, cumulative and nonparticipating preferred stock. Bonita Company has a July 1–June 30 fiscal year.

The following information relates to the stockholders’ equity accounts of Bonita Company.

Common Stock

Prior to the 2017–2018 fiscal year, Bonita Company had 112,100 shares of outstanding common stock issued as follows.

During the 2017–2018 fiscal year, the following transactions regarding common stock took place.

Preferred Stock

Bonita issued 41,000 shares of preferred stock at $45 per share on July 1, 2016.

Cash Dividends

Bonita has followed a schedule of declaring cash dividends in December and June, with payment being made to stockholders of record in the following month. The cash dividends which have been declared since inception of the company through June 30, 2018, are shown below.

Declaration

Date

Common

Stock

Preferred

Stock

No cash dividends were declared during June 2018 due to the company’s liquidity problems.

Retained Earnings

As of June 30, 2017, Bonita’s retained earnings account had a balance of $685,700. For the fiscal year ending June 30, 2018, Bonita reported net income of $40,800.

Prepare the stockholders’ equity section of the balance sheet, for Bonita Company as of June 30, 2018, as it should appear in its annual report to the shareholders.

1.

 

84,400 shares were issued for cash on July 1, 2015, at $29 per share.

2.

 

On July 24, 2015, 5,000 shares were exchanged for a plot of land which cost the seller $66,600 in 2009 and had an estimated fair value of $222,100 on July 24, 2015.

3.

 

22,700 shares were issued on March 1, 2016, for $43 per share.

Wiley PLUS Kieso, Intermediate Accounting, 16e Home Read, Study & Practice Assig Gradebook nment ORION Assignment Open Assignment information.) BONITA COMPANY Stockholders’ Equity License Agreement I Privacy I 20gg 201 Lohn Mulee sans une All Rights Reserved. A Division of Jahn sons uncu Wiley PLUS: MAAileMPLLLS INTERMEDIATE ACCO CALCULATOR MESSAGE MY INSTRUCTOR FULLSCREEN PRINTER VERSI



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