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P15-3 SITUATION
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Amado Company has two classes of capital stock outstanding: 8%, $20 par preferred and $5 par common. At December 31, 2002, the following accounts were included in stockholders' equity.

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The following transactions affected stockholders' equity during 2003.

  1. Jan. 1    25,000 shares of preferred stock issued at $22 per share.
  2. Feb. 1    40,000 shares of common stock issued at $20 per share.
  3. June 1    2-for-1 stock split (par value reduced to $2.50).
  4. July 1    30,000 shares of common treasury stock purchased at $9 per share. Amado uses the cost method.
  5. Sept. 15 10,000 shares of treasury stock reissued at $11 per share.
  6. Dec. 31   Net income is $2,100,000.
  7. Dec. 31   The preferred dividend is declared, and a common dividend of 50 cents per share is declared.




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