Matching type. For each of the following numbered items, you are to select the letter item(s) which indicate its effect on the corporation's financial statements. If more than one answer is possible, be sure to write all the applicable letters. If there is no appropriate response, write the word none. Items 1. Declaration of a cash dividend due in one month on non-cumulative preferred shares. 2. Declaration and payment of an ordinary stock dividend 3. Receipt of cash dividend, not previously accrued or recorded, on the stock of another corporation iny 4. Passing of a dividend on cumulative preferred shares 5. Receipt of preferred shares as a stock dividend on stock held as a temporary investment 6. Payment of payment in no. 1 7. Issue of new common shares in a split up Effects a. Reduces working capital b. Increases working capital c. Reduces current ratio d. Increases current ratio e. Reduces the peso value of total capital stock f. Increases the peso value of total capital stock g. Reduces total retained earnings. h. Reduces equity per share of common stock i. Reduces equity of each common stockholder
Matching type. For each of the following numbered items, you are to select the letter item(s) which indicate its effect on the corporation's financial statements. If more than one answer is possible, be sure to write all the applicable letters. If there is no appropriate response, write the word none. Items 1. Declaration of a cash dividend due in one month on non-cumulative preferred shares. 2. Declaration and payment of an ordinary stock dividend 3. Receipt of cash dividend, not previously accrued or recorded, on the stock of another corporation iny 4. Passing of a dividend on cumulative preferred shares 5. Receipt of preferred shares as a stock dividend on stock held as a temporary investment 6. Payment of payment in no. 1 7. Issue of new common shares in a split up Effects a. Reduces working capital b. Increases working capital c. Reduces current ratio d. Increases current ratio e. Reduces the peso value of total capital stock f. Increases the peso value of total capital stock g. Reduces total retained earnings. h. Reduces equity per share of common stock i. Reduces equity of each common stockholder
SWFT Essntl Tax Individ/Bus Entities 2020
23rd Edition
ISBN:9780357391266
Author:Nellen
Publisher:Nellen
Chapter13: Corporations: Earning & Profits And Distributions
Section: Chapter Questions
Problem 3BD
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Transcribed Image Text:Matching type. For each of the following numbered items, you are to select
the letter item(s) which indicate its effect on the corporation's financial statements. If
more than one answer is possible, be sure to write all the applicable letters. If there
is no appropriate response, write the word none.
Items
1. Declaration of a cash dividend due in one month
on non-cumulative preferred shares.
2. Declaration and payment of an ordinary
stock dividend
3. Receipt of cash dividend, not previously
accrued or recorded, on the stock of another
corporation
4. Passing of a dividend on cumulative
preferred shares
5. Receipt of preferred shares as a stock dividend
on stock held as a temporary investment
6. Payment of payment in no. 1
7. Issue of new common shares in a split up
Effects
a. Reduces working capital
b. Increases working capital
c. Reduces current ratio
d. Increases current ratio
e. Reduces the peso value of
total capital stock
f. Increases the peso value of
total capital stock
g. Reduces total retained
earnings.
h. Reduces equity per share
of common stock
i. Reduces equity of each
common stockholder
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