DeZurik Corporation had the following stockholders’ equity section in its June 30, 2023, balance sheet (in thousands, except share and per share amounts):

June 30 (in thousands)
2023 2022
Paid-in capital:
$4.80 Preferred stock, $ ? par value, cumulative, 200,000 shares authorized, 85,000 shares issued and outstanding $ 5,610
Common stock, $5 par value, 4,000,000 shares authorized, 3,310,000 shares issued, 3,000,000 shares outstanding
Additional paid-in capital on common stock 24,163
Retained earnings
Less: Treasury common stock, at cost, ? shares
Total stockholders' equity $ 66,994 $ 60,627
The transactions affecting the stockholders’ equity accounts of DeZurik Corporation for the year ended June 30, 2023, are summarized here:

310,000 shares of common stock were issued at $14.00 per share.
80,000 shares of treasury (common) stock were sold for $18.3 per share.
Net income for the year was $1,310 (in thousands).
The fiscal 2023 preferred dividends were paid in full. Assume that all 85,000 shares were outstanding throughout the year ended June 30, 2023.
A cash dividend of $0.10 per share was declared and paid to common stockholders. Assume that transactions 1 and 2 occurred before the dividend was declared.
The preferred stock was split 2 for 1 on June 30, 2023. (Note: This transaction had no effect on transaction 4.)
Required:
Record the effect of transactions 1 to 6 in journal entry format.
Calculate the dollar amounts that DeZurik Corporation would report for each stockholders’ equity caption on its June 30, 2023, balance sheet, after recording the effects of transactions 1 to 6. Also the treasury stock was purchased at $18.3.
Indicate how the stockholders’ equity caption details for DeZurik Corporation would change for the June 30, 2023, balance sheet, as compared to the disclosures for the 2022 balance sheet.
What was the average issue price of common stock shown on the June 30, 2023, balance sheet?

Next, let's calculate the dollar amounts that DeZurik Corporation would report for each stockholders’ equity caption on its June 30, 2023, balance sheet:

1. Paid-in capital:

Preferred Stock ($5.61 million)

Common Stock ($16.55 million)

Additional Paid-in Capital on Common Stock ($24.163 million)

Total Paid-in Capital: $46,323,000

2. Retained Earnings:

Beginning Retained Earnings ($60,627,000)

Add: Net Income ($1,310,000)

Less: Common Dividends Paid ($310,000)

Ending Retained Earnings: $61,627,000

3. Treasury Stock:

80,000 shares * $18.3 per share = $1,464,000

4. Total Stockholders' Equity:

Paid-in Capital + Retained Earnings - Treasury Stock

$46,323,000 + $61,627,000 - $1,464,000 = $106,486,000

Finally, let's compare the stockholders’ equity caption details for DeZurik Corporation between the June 30, 2023, and 2022 balance sheets:

- Paid-in Capital:

It increased due to the issuance of common stock and the sale of treasury stock.

- Retained Earnings:

It increased due to net income earned during the year, less dividends paid to common stockholders.

- Treasury Stock:

It increased due to the purchase of treasury stock during the year.

- Total Stockholders' Equity:

It increased compared to the 2022 balance sheet due to the net effect of the transactions.

The average issue price of common stock shown on the June 30, 2023, balance sheet can be calculated by dividing the total amount of common stock issued during the year by the total number of shares issued.

Total amount of common stock issued = $4,340,000 (from transaction 1)

Total number of shares issued = 310,000 shares (from transaction 1)

Average issue price of common stock = $4,340,000 / 310,000 shares = $14 per share