Sandwick Corporation was organized on January 1, 2010, with authorized capital of 500,000 shares of $10 par value common stock. During 2010, Sandwick issued 20,000 shares at $12 per share, purchased 2,000 shares of treasury stock at $13 per share, and sold 2,000 shares of treasury stock at $14 per share. What is the amount of additional paid-in capital at December 31, 2010?

Question

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- Sandwick issued 20,000 shares at $12 per share, meaning they received $240,000 in cash (($12 * 20,000)).
- Sandwick purchased 2,000 shares of treasury stock at $13 per share, meaning they spent $26,000 in cash (($13 * 2,000)).
- Sandwick sold 2,000 shares of treasury stock at $14 per share, meaning they received $28,000 in cash (($14 * 2,000)).

Thus, the total amount of cash received by Sandwick from these transactions is ($240,000 + $28,000 - $26,000) = $242,000.

To calculate additional paid-in capital, we need to first determine the par value of the shares issued. In this case, the par value of each share is $10.

Thus, the total amount of common stock issued in 2010 is ($10 * 20,000) = $200,000.

The difference between the total amount of cash received and the amount of common stock issued is additional paid-in capital.

Additional paid-in capital = ($242,000 - $200,000) = $42,000.

Therefore, the answer is D, $42,000.

Sandwick Corporation Was Organized on January 1, 2010, with Authorized