CorpInc is a CCPC that benefits from the small business deduction (SBD) and pays non-eligible dividends only. In its first twoyears it issued shares to shareholder as follows:Year 1:1,500 common shares to ShX for $3,000• 2,000 common shares to Shy for $6,000Year 2:• 5,000 preferred shares to ShX for $5,000• 5,000 preferred shares to Shy for $5,000In Year 3, a new shareholder, ShZ, purchased all of ShX's common shares for $8,000 and all of ShX's preferred shares for$4,000.In Year 4, CorpInc redeemed all preferred shares at $4 per share.What is the effect of the Year 4 redemption on ShZ's net income?

The objective of the question is to determine the effect of the Year 4 redemption on ShZ's net…

Answered: CorpInc is a CCPC that benefits from…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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ABC CORPORATION HAD 800,000 SHARES OF COMMON STOCK ISSUED AND OUTSTANDING AT JANUARY 1. NO COMMON SHARES WERE ISSUED DURING THE YEAR, BUT ON JANUARY 1. ABC CORPORATION ISSUED 100.000 SHARES OF CONVERTIBLE PREFERRED STOCK. THE PREFERRED SHARES ARE CONVERTIBLE INTO 200.000 SHARES OF COMMON STOCK. DURINGTHE YEAR ABC CORPORATION PAID S60, 000 CASH DIVIDENDS ON THE PREFERRED STOCK. NET INCOME WAS $1,500,000. WHAT WERE ABC CORPORATION'S BASIC AND DILUTEDEARNINGS PER SHARE FOR THE YEAR?
(44). Subject:- Accounting On March 1, Emma Corp purchased 1,900 (or 11%) of the common shares of Christine Corp for $40 per share. Brokerage fees of $1,100 were incurred on the purchase. On December 1, Christine Corp declared and paid $30,000 of dividends. On December 31, shares of Christine Corp were trading at $62 per share. The investment was recorded using FVTOCI. What amount would be recorded to the "Investment in Christine Corp" account on March 1?
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When Ale Co. started operating in Year 1, it issued 750,000 shares of common stock. In Year 2, the company issued 50,000 more shares of common stock and 100,000 shares of preferred stock (with each preferred share convertible into one common share). In Year 3, 40 percent of the preferred shares were converted into common shares. At the end of Year 3, the company underwent a 4-for-1 stock split. Determine the total number of outstanding common stock shares at the end of Year 3.
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Hoopla Ltd. is a Canada Business Corporation and has 16,220 Class A voting (common) shares and 5,710 Class B non voting (preferred shares). Class A shares are non cumulative and Class B shares are cumulative. The Class B shares have a fixed return of $2/share and the dividends to Class A are unlimited. In Year 1 Hoopla paid no dividends. In Year 2, it paid 80 cents a share to Class A and the stated rated to Class B. Required 1: What is the amount of dividends paid out to Class A shareholders in year 2? Required 2:What is the amount of dividends paid out to Class B shareholders in year 2? Required 3: What is the total amount of dividends paid out to shareholders in year 2? Required 4: What is the amount of dividends paid out to Class A shareholders in year 1? Required 5: What is the amount of dividends paid out to Class B shareholders in year 1?
The charter of a corporation provides for the issuance of 94,560 shares of common stock. Assume that 42,608 shares were originally issued and 3,393 were subsequently reacquired. What is the amount of cash dividends to be paid if a $2-per-share dividend is declared? a.$42,608 b.$94,560 c.$3,393 d.$78,430
Brilliant Ltd is a private limited by shares incorporated under Cap. 622. It has firstly issued 5,000 ordinary shares, and subsequently 10,000 8% redeemable preference shares. Both types of shares are issued at $2 each. All monies have been collected for the issued shares.The articles of association of Brilliant states that the preference dividend of the preference shares is to be paid out of yearly profits, and that the holders of the shares only have the right to vote at a meeting of the company when their dividend has not been paid or their rights are being varied.Brilliant has made substantial profits in the initial years and accumulated handsome profits on reserve. In recent years it applied some profits for expansion, but its business deteriorated after expansion. Though it still has positive profits reserve, it has not generated profits for a few years until the last year. In the past three years it did not declare a dividend. The preference shareholders are unhappy about not…
Massive Corp. is authorized to Issue unlimited $0.80 no-par preferred shares and unlimited no-par common shares. There are 15,000 preferred and 45,000 common shares outstanding. In a five-year period, annual dividends pald were $2,000, $6,000, $86,000, $5,000, and $172,000, respectively. Required: Calculate the amount of dividends that would be paid to each share class for each year under the following separate cases. Where applicable, the matching dividend per common share is $1.00.
VGG, Inc. declares a 2-for-5 stock split. The stock currently sells for $4 a share. A shareholder who owned 1000 shares of VGG stock prior to the split will now own OA. 2500 shares valued at about $1.60 a share. OB. 440 shares valued at about $1.60 a share. OC. 250 shares valued at about $11.60 a share. OD. 400 shares valued at about $10.00 a share.
5. Harvey Corporation shows the following in the shareholders' equity section of its statement of financial position: The stated value of its common shares is $0.25 and the total balance in the common shares account is $50,000. Also noted is that 15,000 shares are currently designated as being repurchased but not yet cancelled. The number of shares outstanding is a.215,000. b.200,000. c.196,250. d.185,000.
The following are capital stock transactions of the BBC Corporation. Apr. 1 Authorized to issue 100,000 ordinary shares at P10 par value per share. Five incorporators subscribed a total of 25,000 shares at par, and paid 25% down payment (5,000 shares each). 4Paid incorporation fees to the S.E.C. P 5,300. Issued 200 shares to a lawyer for his legal services. 6: Issued 3,000 shares of stock for cash of P33,000. 9: Received subscriptions for 2,000 shares at P11, collecting a cash down-payment of 25%. 10 : One of the incorporators give merchandise as full payment of his subscription. 15 Three incorporators paid cash for their subscription balance. 16 Another 25% paid by the subscriber on the 9th. 20 An equipment worth P30,000 plus P7,500 cash was received from the last incorporator as full payment of his subscription. 28 2,300 shares were issued, in exchange for a car worth P25,000. 30 The subscriber on the 9th paid his subscription in full. Requirement: Journalize the foregoing…

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