Landmark Company This company reported the following information in the stockholders' equity section of its December 31,2014,balance sheet:
$\begin{array}{ll}
\text { 7 \% Cumulative, Non-paticipating Preferred Stock, \$ 100 par, 500 } \
\text { shares authorized, issued, and outstending callable at par value } &\$ 50,000 \
\text { Common Stock, \$ 12 par, 100,000 shares authorized } &600,000 \
\text { Paid-inC apital in Excess of Par-Common Stock } &25,000 \
\text { Retained Earnings } &825,000
\end{array}$
-Refer to Landmark Company.The company's total capital stock is:

Question

Landmark Company This company reported the following information in the stockholders' equity section of its December 31,2014,balance sheet:
$\begin{array}{ll}
 \text { 7 \%  Cumulative, Non-paticipating Preferred Stock,  \$ 100 par, 500  } \
 \text { shares authorized, issued, and outstending callable at par value } &\$ 50,000 \
 \text { Common Stock, \$ 12  par, 100,000 shares authorized } &600,000 \
 \text { Paid-inC apital in Excess of Par-Common Stock } &25,000 \
 \text { Retained Earnings } &825,000
\end{array}$ 
-Refer to Landmark Company.The company's total capital stock is:

Quizplus · Accepted Answer

Total capital stock is the sum of all types of equity capital, including preferred stock and common stock.

Preferred stock: The number of shares outstanding is given as 500 at a par value of $100 per share, which gives a total value of 500*$100 = $50,000.

Common stock: The number of authorized shares is given as 100,000 at a par value of $12 per share, and the number of issued shares is not given. However, we know that the total paid-in capital in excess of par-common stock is $25,000. This means that the total value of the common stock must be at least $625,000 ($25,000 divided by $12 per share).

Therefore, the total capital stock is $50,000 (preferred stock) + at least $625,000 (common stock) = $675,000.

Hence, the correct answer is B) $675,000.

Landmark Company This Company Reported the Following Information in the Stockholders