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 stock12,000,000
Retained earnings9,000,000
Based on this information, the total amount of the stockholders' equity is equal to:

Answer 1

The total stockholders' equity of the Quiet Canyon Hotel & Spa is calculated by adding the preferred stock value, the common stock at par value, the additional paid-in capital, and the retained earnings, leading to a total of $29,425,000.

Step-by-step explanation:

To calculate the total stockholders' equity of the Quiet Canyon Hotel & Spa, we add up the values given for preferred stock, common stock, additional paid-in capital, and retained earnings. The values provided are:

• Preferred stock: $1,425,000
• Common stock: $7 par value with 1,000,000 shares issued equates to $7,000,000
• Additional paid-in capital—Common stock: $12,000,000
• Retained earnings: $9,000,000

By summing these amounts, the total stockholders' equity is calculated as follows:

$1,425,000 (preferred stock) + $7,000,000 (common stock at par value) + $12,000,000 (additional paid-in capital) + $9,000,000 (retained earnings) = $29,425,000.

Therefore, the total amount of the stockholders' equity for the Quiet Canyon Hotel & Spa is $29,425,000.