Chapter Review
13-9ePractice Exercises
Dividend per Share
OBJ. 3
EE 13-1 Swilley Furniture Company has 50,000 shares of cumulative preferred 2% stock, $75 par, and 100,000 shares of $10 par common stock. The following amounts were distributed as dividends:
Year 1 |
$ 45,000 |
Year 2 |
123,000 |
Year 3 |
130,000 |
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Determine the dividend per share for preferred and common stock for each year.
Dividend per Share
OBJ. 3
EE 13-1 Castillo Nutrition Company has 14,000 shares of cumulative preferred 1% stock, $130 par, and 70,000 shares of $5 par common stock. The following amounts were distributed as dividends:
Year 1 |
$35,000 |
Year 2 |
6,300 |
Year 3 |
80,500 |
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Determine the dividend per share for preferred and common stock for each year.
Entries for Issuing Stock
OBJ. 3
EE 13-2 On May 23, Washburn Realty Inc. issued for cash 45,000 shares of no-par common stock (with a stated value of $4) at $16. On July 6, Washburn Realty Inc. issued at par value 12,000 shares of preferred 1% stock, $75 par for cash. On September 15, Washburn Realty Inc. issued for cash an additional 20,000 shares of no-par common stock (with a stated value of $4) for $22.
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Journalize the entries to record the May 23, July 6, and September 15 transactions.
Entries for Issuing Stock
OBJ. 3
EE 13-2 On January 22, Micah Corporation issued for cash 125,000 shares of no-par common stock at $6. On February 14, Micah Corporation issued at par value 32,000 shares of preferred 2% stock, $80 par for cash. On August 30, Micah Corporation issued for cash 7,000 shares of preferred 2% stock, $80 par at $94.
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Journalize the entries to record the January 22, February 14, and August 30 transactions.
Entries for Cash Dividends
OBJ. 4
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EE 13-3 The declaration, record, and payment dates in connection with a cash dividend of $428,000 on a corporation’s common stock are February 28, April 1, and May 15. Journalize the entries required on each date.
Entries for Cash Dividends
OBJ. 4
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EE 13-3 The declaration, record, and payment dates in connection with a cash dividend of $195,000 on a corporation’s common stock are February 1, March 18, and May 1. Journalize the entries required on each date.
Entries for Stock Dividends
OBJ. 4
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EE 13-4 Top-Value Corporation has 900,000 shares of $26 par common stock outstanding. On September 2, Top-Value Corporation declared a 3% stock dividend to be issued November 30 to stockholders of record on October 3. The market price of the stock was $44 per share on September 2.
Journalize the entries required on September 2, October 3, and November 30.
Entries for Stock Dividends
OBJ. 4
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EE 13-4 Red Market Corporation has 370,000 shares of $27 par common stock outstanding. On June 8, Red Market Corporation declared a 5% stock dividend to be issued August 12 to stockholders of record on July 13. The market price of the stock was $51 per share on June 8.
Journalize the entries required on June 8, July 13, and August 12.
Entries for Treasury Stock
OBJ. 6
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EE 13-5 On January 31, Outback Coast Resorts Inc. reacquired 18,700 shares of its common stock at $45 per share. On April 20, Outback Coast Resorts sold 10,600 of the reacquired shares at $52 per share. On October 4, Outback Coast Resorts sold the remaining shares at $37 per share.
Journalize the transactions of January 31, April 20, and October 4.
Entries for Treasury Stock
OBJ. 6
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EE 13-5 On May 27, Idress Clothing Inc. reacquired 64,000 shares of its common stock at $12 per share. On August 3, Idress Clothing sold 41,000 of the reacquired shares at $17 per share. On November 14, Idress Clothing sold the remaining shares at $9 per share.
Journalize the transactions of May 27, August 3, and November 14.
Reporting Stockholders’ Equity
OBJ. 7
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EE 13-6 Using the following accounts and balances, prepare the Stockholders’ Equity section of the balance sheet using Method 1 of Exhibit 8. Two hundred thousand shares of common stock are authorized, and 5,000 shares have been reacquired.
Common Stock, $3 par
$ 270,000
Paid-In Capital from Sale of Treasury Stock
62,000
Paid-In Capital in Excess of Par—Common Stock
1,196,000
Retained Earnings
7,430,000
Treasury Stock
230,000
Reporting Stockholders’ Equity
OBJ. 7
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EE 13-6 Using the following accounts and balances, prepare the Stockholders’ Equity section of the balance sheet using Method 1 of Exhibit 8. Five hundred thousand shares of common stock are authorized, and 35,000 shares have been reacquired.
Common Stock, $120 par
$25,500,000
Paid-In Capital from Sale of Treasury Stock
4,074,000
Paid-In Capital in Excess of Par—Common Stock
7,230,000
Retained Earnings
47,101,000
Treasury Stock
3,920,000
Retained Earnings Statement
OBJ. 7
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EE 13-7 Seismic Inc. reported the following results for the year ended June 30, 20Y5:
Retained earnings, July 1, 20Y4
$1,700,000
Net income
311,000
Cash dividends declared
44,000
Stock dividends declared
22,000
Prepare a retained earnings statement for the fiscal year ended June 30, 20Y5.
Retained Earnings Statement
OBJ. 7
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EE 13-7 Haggen Cruises Inc. reported the following results for the year ended October 31, 20Y9:
Retained earnings, November 1, 20Y8
$11,775,000
Net income
2,232,000
Cash dividends declared
166,000
Stock dividends declared
285,000
Prepare a retained earnings statement for the fiscal year ended October 31, 20Y9.
Earnings per Share
OBJ. 8
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EE 13-8 Financial statement data for the years ended December 31 for Cottontop Corporation follow:
20Y3
20Y2
Net income
$775,000
$966,000
Preferred dividends
$35,000
$35,000
Average number of common shares outstanding
80,000
shares
95,000
shares
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Determine the earnings per share for 20Y3 and 20Y2.
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Does the change in the earnings per share from 20Y2 to 20Y3 indicate a favorable or unfavorable trend?
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Earnings per Share
OBJ. 8
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EE 13-8 Financial statement data for the years ended December 31 for Brown Cow Inc. follow:
20Y6
20Y5
Net income
$4,243,200
$2,855,360
Preferred dividends
$64,000
$64,000
Average number of common shares outstanding
128,000
shares
104,000
shares
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Determine the earnings per share for 20Y6 and 20Y5.
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Does the change in the earnings per share from 20Y5 to 20Y6 indicate a favorable or unfavorable trend?
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