Buffalo Limited has the following information available regarding its share capital at December 31, 2020:Preferred shares, $3.50 cumulative, 18,700 shares issued $935,000Preferred shares, $4.50 noncumulative, 14,800 shares issued 740,000Common shares, 296,000 shares issued 1,480,000The shares were issued when the corporation began operations on January 1, 2019. No dividends were declared during 2019 and 2020. On October 30, 2021, the board of directors declares the required preferred share dividends and a $0.50 dividend for each of the common shares. The dividends are payable on December 1, 2021, to the shareholders of record on November 16, 2021. How much will be paid to each class of shares?Cumulative preferred shares $enter a dollar amount Noncumulative preferred shares $enter a dollar amount Common shares $enter a dollar amount Prepare journal entries on the appropriate dates for the 2021 dividends. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Record journal entries in the order presented in the problem.)DateAccount Titles and ExplanationDebitCreditOct. 30enter an account title to record declaration of dividend on October 30enter a debit amountenter a credit amount enter an account title to record declaration of dividend on October 30enter a debit amountenter a credit amount enter an account title to record declaration of dividend on October 30enter a debit amountenter a credit amount (To record declaration of dividend.) choose a transaction date enter an account titleenter a debit amountenter a credit amount enter an account titleenter a debit amountenter a credit amountchoose a transaction date enter an account title to record payment of dividendenter a debit amountenter a credit amount enter an account title to record payment of dividendenter a debit amountenter a credit amount (To record payment of dividend.) Assume instead that the maximum cash dividend the company can pay in 2021 is $180,850.Determine how much will be paid to the preferred shareholders and to the common shareholders.Dividends paid to the preferred shareholders $enter a dollar amount Dividends paid to the common shareholders $enter a dollar amount

The dividend represents the distribution of proot among the shareholders of the company. It is…

Answered: Buffalo Limited has the following…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Question

Buffalo Limited has the following information available regarding its share capital at December 31, 2020:

Preferred shares, $3.50 cumulative, 18,700 shares issued		$935,000
Preferred shares, $4.50 noncumulative, 14,800 shares issued		740,000
Common shares, 296,000 shares issued		1,480,000

The shares were issued when the corporation began operations on January 1, 2019. No dividends were declared during 2019 and 2020. On October 30, 2021, the board of directors declares the required preferred share dividends and a $0.50 dividend for each of the common shares. The dividends are payable on December 1, 2021, to the shareholders of record on November 16, 2021.

How much will be paid to each class of shares?

Cumulative preferred shares		$enter a dollar amount
Noncumulative preferred shares		$enter a dollar amount
Common shares		$enter a dollar amount

Prepare journal entries on the appropriate dates for the 2021 dividends. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Record journal entries in the order presented in the problem.)

Date	Account Titles and Explanation	Debit	Credit
Oct. 30	enter an account title to record declaration of dividend on October 30	enter a debit amount	enter a credit amount
	enter an account title to record declaration of dividend on October 30	enter a debit amount	enter a credit amount
	enter an account title to record declaration of dividend on October 30	enter a debit amount	enter a credit amount
	(To record declaration of dividend.)
choose a transaction date	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount
choose a transaction date	enter an account title to record payment of dividend	enter a debit amount	enter a credit amount
	enter an account title to record payment of dividend	enter a debit amount	enter a credit amount
	(To record payment of dividend.)

Assume instead that the maximum cash dividend the company can pay in 2021 is $180,850.

Determine how much will be paid to the preferred shareholders and to the common shareholders.

Dividends paid to the preferred shareholders		$enter a dollar amount
Dividends paid to the common shareholders		$enter a dollar amount

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 4 steps with 1 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.