Lanier Tech This company was incorporated as a new business on January 1,2015.The company is authorized to issue 50,000 shares of $5 par common stock and 10,000 shares of 6%,$10 par,cumulative,participating preferred stock.On January 1,2015,the company issued 8,000 shares of the common stock for $15 per share and 2,000 share of the preferred stock for $30 per share.Net income for the year ended December 31,2015 was $375,000.
-Refer to Lanier Tech.What is the amount of the company's total capital stock at December 31,2015?

Question

Quizplus · Accepted Answer

To find the total capital stock, we need to calculate the total amount of common stock and preferred stock issued as of December 31, 2015.

Common stock:
8,000 shares * $5 par value per share = $40,000

Preferred stock:
2,000 shares * $10 par value per share = $20,000

Total capital stock:
$40,000 (common stock) + $20,000 (preferred stock) = $60,000

Therefore, the correct answer is C) $180,000.

Lanier Tech This Company Was Incorporated as a New Business