Question

(Algo) Common stock balance sheet disclosure LO 8-1, 8-3 The balance sheet caption for common stock is the following: Common stock, $10 par value, 500,000 shares authorized, 410,500 shares $? issued, 380,200 shares outstanding Required: Calculate the dollar amount that will be presented opposite this caption.

Answer 1

The dollar amount presented on the balance sheet for the common stock caption, which has a par value of $10 and 410,500 shares issued, is $4,105,000.

Step-by-step explanation:

The balance sheet caption for common stock typically shows the par value of the stock, the number of shares authorized, the number of shares issued, and the number of shares outstanding. In the question presented, the par value is $10, and there are 410,500 shares issued. To calculate the dollar amount that will be presented on the balance sheet, you multiply the number of shares issued by the par value of each share.

Common stock dollar amount = Number of shares issued × Par value of each share

Common stock dollar amount = 410,500 shares × $10 = $4,105,000.

Therefore, the dollar amount that will be presented opposite the common stock caption on the balance sheet is $4,105,000.