Question Details

stockholders' equity section of Kennedy Company's 


Kennedy Company reported the following balances at December 31, 2012: common stock $500,000; paid-in capital in excess of par value $200,000; retained earnings $350,000. During 2013, the following transactions affected stockholders' equity.

	1. Issued preferred stock with a par value of $250,000 for $290,000.
	2. Purchased treasury stock (common) for $70,000.
	3. Earned net income of $220,000.
	4. Declared and paid cash dividends of $86,000 ($16,000 preferred).

Instructions
(a)	Prepare the stockholders' equity section of Kennedy Company's December 31, 2013, balance sheet. 
(b)	Compute Kennedy's 2013 return on common stockholders' equity. 




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