Assume that a company has the following information: Common Stock Information: # of shares issued and outstanding Par value per share 20,000 $9 Stockholders' Equity section of the Balance Sheet: Common Stock Additional Paid in Capital Retained Earnings Total Stockholders' Equity $180,000 $3,000,000 $4,820,000 $8,000,000 The company has the option of EITHER announcing a 3:1 stock split OR declaring a 200% stock dividend. Fill in the blanks below to show the stockholders' equity balances under each of these options. After After Current 3:1 200% Situation Stock Split Stock Dividend Common Stock Information: # of shares issued and outstanding 20,000 Par value per share $9 Stockholders' Equity section of the Balance Sheet: Common Stock $180,000 Additional Paid in Capital $3,000,000 Retained Earnings $4,820,000 Total Stockholders' Equity $8,000,000 IIII II IIII

Assume that a company has the following information: Common Stock Information: # of shares issued and outstanding Par value per share 20,000 $9 Stockholders' Equity section of the Balance Sheet: Common Stock Additional Paid in Capital Retained Earnings Total Stockholders' Equity $180,000 $3,000,000 $4,820,000 $8,000,000 The company has the option of EITHER announcing a 3:1 stock split OR declaring a 200% stock dividend. Fill in the blanks below to show the stockholders' equity balances under each of these options. After After Current 3:1 200% Situation Stock Split Stock Dividend Common Stock Information: # of shares issued and outstanding 20,000 Par value per share $9 Stockholders' Equity section of the Balance Sheet: Common Stock $180,000 Additional Paid in Capital $3,000,000 Retained Earnings $4,820,000 Total Stockholders' Equity $8,000,000 IIII II IIII

Financial Accounting: The Impact on Decision Makers

10th Edition

ISBN:9781305654174

Author:Gary A. Porter, Curtis L. Norton

Publisher:Gary A. Porter, Curtis L. Norton

Chapter11: Stockholders' Equity

Section: Chapter Questions

Problem 11.1E

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Outstanding Stock Lars Corporation shows the following information in the stockholders equity section of its balance sheet: The par value of common stock is S5, and the total balance in the Common Stock account is $225,000. There are 13,000 shares of treasury stock. Required: What is the number of shares outstanding? Use the following information for Exercises 10-58 and 10-59: Stahl Company was incorporated as a new business on January 1, 2019. The company is authorized to issue 600,000 shares of $2 par value common stock and 80,000 shares of 6%, S20 par value, cumulative preferred stock. On January 1, 2019, the company issued 75,000 shares of common stock for $15 per share and 5,000 shares of preferred stock for $25 per share. Net income for the year ended December 31, 2019, was $500,000.
A corporation issued 100 shares of $100 par value preferred stock for $150 per share. The resulting journal entry would include which of the following? A. a credit to common stock B. a credit to cash C. a debit to paid-in capital in excess of preferred stock D. a debit to cash
Stockholders' Equity Terminology A list of terms and a list of definitions or examples are presented below. Make a list of the numbers 1 through 12 and match the letter of the most directly related definition or example with each number Definitions and Examples Capitalizes retained earnings. Shares issued minus treasury shares. Emerson Electric will pay a dividend to all persons holding shares of its common stock on December 15, 2019, even if they just bought the shares and sell them a few days later. The accumulated earnings over the entire life of the corporation that have not been paid out in dividends. Common Stock account balance divided by the number of shares issued. The state of Louisiana set an upper limit of 1,000,000 on the number of shares that Gumps Catch Inc. can issue. Shares that never earn dividends. Any changes to stockholders equity from transactions with no owners. A right to purchase stock at a specified future time and specified price. j. A stock issue that requires no journal entry. k. Shares that may earn guaranteed dividends. 1. On October 15, 2019, General Electric announced its intention to pay a dividend on common stock.
Following is the shareholders equity section of All-Wood Doors on a day a. Use the financial statement template below to show the financial statement effects of the following dividend events. (Assume that the events are independent.) (1) Cash dividend declaration and payment of 1 per share (3) Property dividend declaration and payment of shares representing a short-term investment in Screen Products, Ltd., with a fair value of 10,000 (3) 10% stock dividend (4) 100% stock dividend (5) 3-for-1 stock split (6) 1-for-2 reverse stock split b. Which events changed the book value of common equity? Under what conditions will these events lead to future increases and decreases in ROE?
Nutritious Pet Food Companys board of directors declares a large stock dividend (50%) on June 30 when the stocks market value per share is $30. At that time, there are 10,000 shares of $1 par value common stock outstanding (none held in treasury). What is the journal entry to record the declaration of the dividend?
Raun Company had the following equity items as of December 31, 2019: Preferred stock, 9% cumulative, 100 par, convertible Paid-in capital in excess of par value on preferred stock Common stock, 1 stated value Paid-in capital in excess of stated value on common stock| Retained earnings The following additional information about Raun was available for the year ended December 31, 2019: 1. There were 2 million shares of preferred stock authorized, of which 1 million were outstanding. All 1 million shares outstanding were issued on January 2, 2016, for 120 a share. The preferred stock is convertible into common stock on a 1-for-1 basis until December 31, 2025; thereafter, the preferred stock ceases to be convertible and is callable at par value by the company. No preferred stock has been converted into common stock, and there were no dividends in arrears at December 31, 2019. 2. The common stock has been issued at amounts above stated value per share since incorporation in 2002. Of the 5 million shares authorized, 3,580,000 were outstanding at January 1, 2019. The market price of the outstanding common stock has increased slowly but consistently for the last 5 years. 3. Raun has an employee share option plan where certain key employees and officers may purchase shares of common stock at 100% of the marker price at the date of the option grant. All options are exercisable in installments of one-third each year, commencing 1 year after the date of the grant, and expire if not exercised within 4 years of the grant date. On January 1, 2019, options for 70,000 shares were outstanding at prices ranging from 47 to 83 a share. Options for 20,000 shares were exercised at 47 to 79 a share during 2019. During 2019, no options expired and additional options for 15,000 shares were granted at 86 a share. The 65,000 options outstanding at December 31, 2019, were exercisable at 54 to 86 a share; of these, 30,000 were exercisable at that date at prices ranging from 54 to 79 a share. 4. Raun also has an employee share purchase plan whereby the company pays one-half and the employee pays one-half of the market price of the stock at the date of the subscription. During 2019, employees subscribed to 60,000 shares at an average price of 87 a share. All 60,000 shares were paid for and issued late in September 2019. 5. On December 31, 2019, there was a total of 355,000 shares of common stock set aside for the granting of future share options and for future purchases under the employee share purchase plan. The only changes in the shareholders equity for 2019 were those described previously, the 2019 net income, and the cash dividends paid. Required: Prepare the shareholders equity section of Rauns balance sheet at December 31, 2019. Substitute, where appropriate, Xs for unknown dollar amounts. Use good form and provide full disclosure. Write appropriate notes as they should appear in the publisher financial statements.
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The following information relates to X, Y, and Z as at 30 June 2021 Stock Share price Number of shares X 10 2,000,000 Y 15 6,000,000 Z 20 10,000,000 During the year the following activities occurred; A two for one stock split on Y Payment of 10% dividend on Z. It can be assumed that the entire dividend paid will be reinvested in shares of Z limited. On 30 June 2022 the stock prices of X, Y and Z were sh 12, sh 10 and sh 20 respectively. Required; New index value given that the beginning value index is 100. Explain how secondary markets benefit investors. State and explain the main risks faced by financial institutions in the course of conduct of their business.
The shareholders’ equity of Raven Company is as shown: RAVEN COMPANY Partial Balance Sheet 1 Common stock, $10 par $200,000.00 2 Additional paid-in capital on common stock 100,000.00 3 Retained earnings 200,000.00 4 $500,000.00 Raven is considering the declaration and issuance of a stock dividend at a time when the market price is $25 per share. Required: 1. Assuming the board of directors recommends a 6% stock dividend, prepare: a. the journal entry at the date of declaration b. the journal entry at the date of issuance c. shareholders’ equity after the issuance 2. Assuming, instead, that a 40% stock dividend is recommended, answer a, b, and c of Requirement 1. Chart of Accounts CHART OF ACCOUNTS Raven Company General Ledger ASSETS 111 Cash 121 Accounts Receivable 141 Inventory 152 Prepaid Insurance 181 Equipment 189 Accumulated Depreciation…
The owners' equity accounts for Mars International are shown here: Common stock ($.50 par value) Capital surplus Retained earnings Total owner's equity Please show the equity accounts will change if: a. The company declares a 5-for-1 stock split. How many shares are outstanding now? What is the new par value per share? b. The company declares a 1-for-4 reverse stock split. $20,000 210,000 587,300 $817,300 c. The balance sheet for Mars International is shown below in Market value terms. There are 12,000 shares of stock outstanding. Market Value Balance Sheet Equity $817,300 Cash $ 99,660 Fixed assets 717,640 Total $817,300 Total $817,300 The company has declared a dividend of $1.45 per share. The stock goes ex dividend tomorrow. Ignoring any tax effects, what is the stock selling for today? What will it sell for tomorrow? What will the balance sheet look like after the dividends are paid? d. suppose the company has announced it is going to repurchase $17,400 worth of stock. What effect…
At December 31, Artists Unlimited Company had the following stockholders' equity components that would be part of the balance sheet: how to find retained earnings of the stock dividend. please include formula
A corporation has 50,000 shares of $100 par value stock outstanding that has a current market value of $180. If the corporation issues a 4-for-1 stock split, the market value of the stock will fall to approximately: Oa. $36. Ob. $30. Oc. $50. Od. $45.