Question

The Quiet Canyon Hotel & Spa provides the following information on the shareholders' equity from its balance sheet:

7% Preferred stock, $50 par, callable at $57
30,000 shares authorized and 25,000 shares issued $1,425,000
Common stock, $7 par value
1,500,000 shares authorized, 1,000,000 shares issued ?
Additional paid-in capital--Common stock 12,000,000
Retained earnings 9,000,000
Based on this information, the total amount of the stockholders' equity is equal to:

Answer 1

The total amount of stockholders' equity is $23,675,000.

Step-by-step explanation:

To calculate the total amount of stockholders' equity, we need to add up the preferred stock, common stock, additional paid-in capital, and retained earnings. From the given information, we have:

• Preferred stock: 25,000 shares issued with a par value of $50 per share
• Common stock: 1,000,000 shares issued with a par value of $7 per share
• Additional paid-in capital: $12,000,000
• Retained earnings: $9,000,000

Calculating the preferred stock: 25,000 shares x $50 par value = $1,250,000. Adding this to the other components, we have:

Total stockholders' equity = Preferred stock + Common stock + Additional paid-in capital + Retained earnings = $1,250,000 + $1,425,000 + $12,000,000 + $9,000,000 = $23,675,000.