Identifying and Analyzing Financial Statement Effects of Dividends The statement of shareholders' equity of Reliable Storage Corporation for the year ended December 31, reports the following dividends paid to shareholders ($ thousands). Distributions to equity holders Preferred shares $346,106 Common shares $2,234,182 The year-end balance sheet includes the following ($ thousands except share data). Preferred Shares, $0.01 par value, 100,000,000 shares authorized, 161,000 shares issued and outstanding $6,440,000 Common Shares, $0.10 par value, 650,000,000 shares authorized, 174,130,881 shares issued and outstanding $27,861 a. Use the financial statement effects template to indicate the effects of (a) the preferred dividend declaration and payments and (b) the common dividend declaration and payments. Note: For each account category, indicate the appropriate account name. Enter "N/A" for any account category that is not used for a given transaction. Note: Indicate a decrease in an account category by including a negative sign with the amount. ($ thousands) Transaction (a) Preferred dividend payment (b) Common dividend payment Dividends per Share Preferred shareholders: $ Common shareholders: $ Check Cash Cash Cash Asset 0.94 x 0.01 X (346,106) ✔ (2,234,182) ✔ ◆ N/A b. Determine the dividends per share for both classes of stock. Note: Round your answers to two decimal places (for example, enter 67.49 for 67.48555). N/A Noncash Assets 0✔= → ✓ N/A 0✓= N/A Balance Sheet Liabilities 0✔ → 0✔ ◆ N/A N/A Contrib. Capital
Identifying and Analyzing Financial Statement Effects of Dividends The statement of shareholders' equity of Reliable Storage Corporation for the year ended December 31, reports the following dividends paid to shareholders ($ thousands). Distributions to equity holders Preferred shares $346,106 Common shares $2,234,182 The year-end balance sheet includes the following ($ thousands except share data). Preferred Shares, $0.01 par value, 100,000,000 shares authorized, 161,000 shares issued and outstanding $6,440,000 Common Shares, $0.10 par value, 650,000,000 shares authorized, 174,130,881 shares issued and outstanding $27,861 a. Use the financial statement effects template to indicate the effects of (a) the preferred dividend declaration and payments and (b) the common dividend declaration and payments. Note: For each account category, indicate the appropriate account name. Enter "N/A" for any account category that is not used for a given transaction. Note: Indicate a decrease in an account category by including a negative sign with the amount. ($ thousands) Transaction (a) Preferred dividend payment (b) Common dividend payment Dividends per Share Preferred shareholders: $ Common shareholders: $ Check Cash Cash Cash Asset 0.94 x 0.01 X (346,106) ✔ (2,234,182) ✔ ◆ N/A b. Determine the dividends per share for both classes of stock. Note: Round your answers to two decimal places (for example, enter 67.49 for 67.48555). N/A Noncash Assets 0✔= → ✓ N/A 0✓= N/A Balance Sheet Liabilities 0✔ → 0✔ ◆ N/A N/A Contrib. Capital
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Can you fix the dividends per share for both classes of stock.
Transcribed Image Text:**Identifying and Analyzing Financial Statement Effects of Dividends**
The statement of shareholders' equity of Reliable Storage Corporation for the year ended December 31 reports the following dividends paid to shareholders (in thousands of dollars):
- **Distributions to equity holders**:
- Preferred shares: $346,106
- Common shares: $2,234,182
The year-end balance sheet includes the following data (in thousands of dollars, except share data):
- Preferred Shares: $0.01 par value, 100,000,000 shares authorized, 161,000 shares issued and outstanding, $6,440,000
- Common Shares: $0.10 par value, 650,000,000 shares authorized, 174,130,881 shares issued and outstanding, $27,861
### a. Financial Statement Effects Template
Use the financial statement effects template to indicate the effects of (a) the preferred dividend declaration and payments and (b) the common dividend declaration and payments.
**Note**:
- For each account category, indicate the appropriate account name. Enter "N/A" for any account category that is not used for a given transaction.
- Indicate a decrease in an account category by including a negative sign with the amount.
| Transaction | Cash Asset | Noncash Assets | Liabilities | Contrib. Capital |
|-------------------------------|------------|----------------|-------------|-----------------|
| (a) Preferred dividend payment| (346,106) | 0 | 0 | N/A |
| Cash | ✔ | N/A | ✔ | N/A |
| (b) Common dividend payment | (2,234,182)| 0 | 0 | N/A |
| Cash | ✔ | N/A | ✔ | N/A |
### b. Determine the dividends per share for both classes of stock.
**Note**: Round your answers to two decimal places (for example, enter 67.49 for 67.48555).
- **Dividends per Share**:
- Preferred shareholders: $0.94
- Common shareholders: $0.01
✔ Check
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