The equity sections from Atticus Group’s 2013 and 2014 year-end balance sheets follow.    

Stockholders’ Equity (December 31, 2013) 

Common stock—$4 par value,100,000 shares authorized, 40,000 shares issued and outstanding$160,000    

Paid-in capital in excess of par value, common stock 120,000    

Retained earnings 320,000        

Total stockholders’ equity$600,000         

Stockholders’ Equity (December 31, 2014)    

 Common stock—$4 par value, 100,000 shares authorized, 47,400 shares issued, 3,000 shares in treasury$189,600   

Paid-in capital in excess of par value, common stock 179,200   

Retained earnings ($30,000 restricted by treasury stock)  400,000        768,800   Less cost of treasury stock  (30,000)     

Total stockholders’ equity$ 738,800       

The following transactions and events affected its equity during year 2014.     

• Jan. 5 Declared a $0.50 per share cash dividend, date of record January 10.
• Mar. 20 Purchased treasury stock for cash.
• Apr. 5 Declared a $0.50 per share cash dividend, date of record April 10.
• July. 5 Declared a $0.50 per share cash dividend, date of record July 10.
• July. 31 Declared a 20% stock dividend when the stock’s market value is $12 per share.
• Aug. 14 Issued the stock dividend that was declared on July 31.
• Oct. 5 Declared a $0.50 per share cash dividend, date of record October 10.

How do you figure out common shares?

The equity sections from Atticus Group’s 2013 and 2014 year-end balance sheets follow. Stockholders’ Equity (December 31, 2013) Common stock, $4 par value, 100,000 shares authorized,

40,000 shares issued and outstanding$160,000 Paid-in capital in excess of par value, common stock 120,000 Retained earnings 320,000 Total stockholders’ equity$600,000 Stockholders’ Equity (December 31, 2014) Common stock $4 par value, 100,000 shares

authorized, 47,400 shares issued, 3,000 shares in treasury$ 189,600 Paid-in capital in excess of par value, common stock 179,200 Retained earnings ($30,000 restricted by treasury stock) 400,000 768,800 Less cost of treasury stock (30,000) Total stockholders’ equity$ 738,800

The following transactions and events affected its equity during year 2014.

• Jan. 5 Declared a $0.50 per share cash dividend, date of record January 10.
• Mar. 20 Purchased treasury stock for cash.
• Apr. 5 Declared a $0.50 per share cash dividend, date of record April 10.
• July. 5 Declared a $0.50 per share cash dividend, date of record July 10.
• July. 31 Declared a 20% stock dividend when the stock’s market value is $12 per share.
• Aug.14 Issued the stock dividend that was declared on July 31.
• Oct. 5 Declared a $0.50 per share cash dividend, date of record October 10.

How do you figure out common shares?

Answer and step by step explanation

Common dividend declared=44,400*0.5=22,200

Opening shares	40,000
Treasury stock purchased	(3000)
	37,000
Stock dividend@20%	7400
No of common shares outstanding	44,400
Cash dividend per share

Journal entries 

Date	Particulars	Debit	Credit
5/01	Common cash dividend(40,000*0.5)	20,000
	Dividends payable		20,000
	(To record cash dividend declared $0.5/share payable on 10/01)
10/01	Cash dividend payable	20,000
	Cash		20,000
	(Being dividend paid)
20/3	Treasury stock	30,000
	Cash		30,000
	(To record purchase of treasury stock for cash)
5/04	Common cash dividend (40,000-3000)*0.5	18,500
	Dividends payable		18,500
	(To record 0.5/share cash dividend payable on 10/4)
10/04	Cash dividend payable	18,500
	Cash		18,500
	(Being cash dividend paid)
5/07	Common cash dividend	18,500
	Dividends payable		18,500
	( to record 0.5/share cash dividend declared payable on 10/07)
10/07	Cash dividend payable	18,500
	Cash		18,500
	(Being dividend paid)
31/07	Common stock dividend(40,000-3000)*20%*12	88,800
	Common stock dividend distributable(40,000-3000)*20%*4		29,600
	Paid in capital in excess of par value-Common stock		59,200
	(To record dividend declared@20% when MV is $12/share)
14/08	Common stock dividend distributable	29,600
	Common stock		29,600
5/10	Common cash dividend	22,200
	Dividends payable		22,200
	(Declared a 0.5/share cash dividend)
10/10	Cash dividend payable	22,200
	Cash		22,200
31/12	Retained earnings	168,000
	Common stock dividend		88,800
	Common cash dividend		79,200
31/12	Income summary	248,000
	Retained earnings(400,000-320,000+79,200+88,800)		248,000
	(close income summary to retained earnings)

Retained Earnings account 

	Debit		Credit
31/12	79,200	Open bal	320,000
31/12	88,800	31/12	248,000
		Bal(Given in question)	400,000

Paid in  capital in excess of par 

	Debit		Credit
		OPn bal	120,000
		31/07	59200
		Bal	179,200

Common stock 

	Debit		Credit
		OB	160,000
		14/08	29,600
		Bal	189,600

Answer;

Jan-05 40000

Apr-05 44400

Jul-05 44400

Jul-31 44400

Aug-14 44400

Oct-05 44400

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