Vega Corporation's December 31, 2015 balance sheet showed the following: 8% preferred stock, $20 par value, cumulative, 10,000 shares $\begin{array}{lr}
\text { authorized; 8,500 shares issued } & \$ 170,000 \
\text { Common stock, } \$ 10 \text { par value, } 1,000,000 \text { shares authorized; } & \
950,000 \text { shares issued, 940,000 shares outstanding } & 9,500,000 \
\text { Paid-in capital in excess of par-preferred stock } & 34,000 \
\text { Paid-in capital in excess of par-common stock } & 11,500,000 \
\text { Retained earnings } & 3,750,000 \
\text { Treasury stock ( } 15,000 \text { shares) } & 315,000
\end{array}$
Vega's total stockholders' equity was

Question

Vega Corporation's December 31, 2015 balance sheet showed the following: 8% preferred stock, $20 par value, cumulative, 10,000 shares $\begin{array}{lr}
\text { authorized; 8,500 shares issued } & \$ 170,000 \
\text { Common stock, } \$ 10 \text { par value, } 1,000,000 \text { shares authorized; } & \
950,000 \text { shares issued, 940,000 shares outstanding } & 9,500,000 \
\text { Paid-in capital in excess of par-preferred stock } & 34,000 \
\text { Paid-in capital in excess of par-common stock } & 11,500,000 \
\text { Retained earnings } & 3,750,000 \
\text { Treasury stock ( } 15,000 \text { shares) } & 315,000
\end{array}$
 Vega's total stockholders' equity was

Quizplus · Accepted Answer

The preferred stock's total value can be calculated as:
$20 par value x 10,000 shares = $200,000
Since it is cumulative, any unpaid dividends must be added to the stock's value. However, the question does not provide any information regarding unpaid dividends. 
Therefore, the total stockholders' equity must be greater than $200,000, which eliminates choices A and B. 
Choice C is higher than the sum of the preferred stock's value and any possible unpaid dividends, making it an unlikely option. 
Thus, the best choice is D.

Vega Corporation's December 31, 2015 Balance Sheet Showed the Following