The balance sheet of Castle Corporation includes the following equity section:
Capital stock:
Common stock, $2 par, 50,000 shares authorized,
30,000 shares issued and outstanding ………………………..$ 60,000
Paid in capital in excess of par ………………………………. 71,800
Total capital stock ……………………………………………. $131,800
Retained earnings …………………………………………….. 73,000
Total equity ……………………………………………………. $204,800
Required:
1. Assume that Castle issued 30,000 shares for cash at the inception of the corporation and that no new shares have been issued since. Determine how much cash was received for the shares issued at inception.
2. Assume that Castle issued 15,000 shares for cash at the inception of the corporation and subsequently declared a 2 for 1 stock split. Determine how much cash was received for the shares issued at inception.
3. Assume that Castle issued 25,000 shares for cash at the inception of the corporation and that the remaining 5,000 shares issued are the result of stock dividends that capitalized retained earnings of $21,600. Determine how much cash was received for the shares issued at inception.