A partial listing of accounts and ending balances for Carver, Inc., on December 31, 2016, is shown below:

Question

Investments in long-term notes receivable$ 40,000
Bonds payable300,000
Temporary investment in equity securities available for sale120,000
Premium on bonds payable26,000
Common stock180,000
Subscriptions receivable: common stock120,000
Additional paid-in capital from preferred stock conversion24,000
Retained earnings650,000
Preferred stock300,000
Long-term investment in equity securities available for sale150,000
Additional paid-in capital on common stock910,000
Common stock subscribed20,000
Goodwill46,000
Donated capital35,000
Preferred stock subscribed50,000
Additional paid-in capital on preferred stock45,000
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Following is additional information relative to the above accounts:
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The preferred stock is 8% cumulative with par value of $50. For the preferred stock, 10,000 shares have been authorized, 6,000 shares are issued and outstanding, and 1,000 shares have been subscribed at a price of $65 per share. Each share of preferred stock is convertible into four shares of common.
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Bonds payable mature on September 30, 2020. They have a stated interest rate of 10%, payable semiannually. The straight-line method is used to amortize the premium.
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Common stock has a par value of $4 per share. For the common stock, 60,000 shares have been authorized, 45,000 shares are issued and outstanding, and 5,000 shares have been subscribed at $32 per share.
Required:Prepare the contributed capital section of the December 31, 2016 balance sheet for Carver, Inc. Include appropriate parenthetical notes for the common and preferred stock.

What will be an ideal response?

Answer 1

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