QS 11-12 (Algo) Dividend allocation between classes of shareholders LO C2Stockholders' equity of Ernst Company consists of 89,000 shares of $5 par value, 9% cumulative preferred stock and 325,000 sharesof $1 par value common stock. Both classes of stock have been outstanding since the company's inception. Ernst did not declare anydividends in the prior year, but it now declares and pays a $140,000 cash dividend at the current year-end.Determine the amount distributed to each class of stockholders for this two-year-old company.Calculation of preferred dividend:Total cash dividendTo preferred shareholdersTo common shareholdersPar Value perPreferredShareDividendRate%Dividend perPreferredShare< PrevNumber ofPreferredShares5 of 7MacBook AirPreferredDividend fortwo yearsNext >

Dividend - Dividend is the amount declared by the company from the accumulated profit earned by it.…

Answered: QS 11-12 (Algo) Dividend allocation…

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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PROBLEM NO. 1 Watusi Inc. began operations in January 2021 and reported the following results for each of its 3 years of operations. 2021 P260,000 net loss P40,000 net loss P700,000 net income 2022 2023 At December 31, 2023, Watusi Inc. share capital accounts were as follows. Share Capital-Preference, 6% cumulative, par value P100; authorized, issued, and outstanding 5,000 shares Share Capital-Ordinary, par value P1.00; authorized 1,000,000 shares; issued and outstanding 750,000 shares P500,000 750,000 Watusi Inc. has never paid a cash or share dividend. There has been no change in the share capital accounts since Watusi began operations. The country law permits dividends only from retained earnings. Instructions a. Compute the book value of the ordinary shares at December 31, 2023. b. Compute the book value of the ordinary shares at December 31, 2023, assuming that the preference shares have a liquidating value of P106 per share.
Required information Problem 11-5A Computing book values and dividend allocations LO C2, A4 [The following information applies to the questions displayed below.] Raphael Corporation’s balance sheet shows the following stockholders’ equity section. Preferred stock—5% cumulative, $___ par value, 1,000 sharesauthorized, issued, and outstanding $ 50,000 Common stock—$___ par value, 4,000 shares authorized, issued,and outstanding 80,000 Retained earnings 150,000 Total stockholders' equity $ 280,000 Problem 11-5A Part 4 4. If two years’ preferred dividends are in arrears at the current date and the board of directors declares cash dividends of $11,500, what total amount will be paid to the preferred and to the common shareholders?
Problem 4 (Adapted)The shareholders equity of Joyce corporation on Dec. 31, 2018 shows the following account balances:10% preference share, 10,000 shares, 100 par 1,000,00012% preference share, 12,000 shares, 100 par 1,200,000Ordinary share, 20,000 shares, 40 par 800,000 Share premium 640,000Accumulated profits 960,000The 10% preference share is cumulative and fully participating, while the 12% preference share is non-cumulative and fully participating. The last payment of dividends was on Dec. 31, 2016. What is the book value per share of ordinary shares?
Exercise 6-2 (Cash and Share Capital Stock Dividends) The statement of financial position of JKL Corp. as of December 31, 2020 reports the following shareholder equity accounts: Ordinary Share Capital, P50 par, 100,000 shares outstanding Ordinary Share Premium Retained Earnings P5,000,000 2,500,000 3,000,000 During 2021, the following dividend distributions were made: April 1 Declared a cash dividend of P7 per share payable on May 2 to shareholders of record of April 15. June 1 Decdared a 10% stock dividend distributable on July 15 to shareholders of record of June 30. Stocks are selling on this date at P65 per share Instructions: Record the declaration and distribution of each of the above-mentioned dividends. Share Favourite Delete Edit More ... 归 0
Accounting CP 11-9 The following information is extracted from the shareholders' equity section of the statement of financial position of Gibson Clothing Inc. at December 31, 2018: Preferred shares, stated value $10, non-cumulative Issued and outstanding – 5,000 shares Common shares, stated value $2 Issued and outstanding – 20,000 shares Retained earnings $ 20,000 40,000 150,000 $210,000 Total shareholders' equity Additional information: a. There are $2,000 of dividends in arrears on the preferred shares. b. The liquidation value of the preferred shares is $25,000. Required: Calculate the book value of preferred and common shares.
MC Qu. 11-153 A company has outstanding... A company has outstanding 13.50 million shares of $5.50 par common stock and 1.7 million shares of $4.70 par preferred stock. The preferred stock has an 9% dividend rate. The company declares $370,000 in total dividends for the year. Which of the following is correct if the preferred stockholders only have a current dividend preference? Multiple Choice O Preferred stockholders will receive the entire $370,000, and they must also be paid $53,000 before the end of the current accounting period. Common stockholders will receive nothing. Preferred stockholders will receive $33,300 or 9% of the total dividends. Common stockholders will receive the remaining $336,700. Preferred stockholders will receive the entire $370,000, and they must also be paid $53,000 sometime in the future before common stockholders will receive anything. Preferred stockholders will receive the entire $370,000, but will receive nothing more relating to this dividend…
Problem 4 On December 29, 2018, Blue Company was registered at the Securities and Exchange Commission with 100,00 authorized shares of P100 par value. The following were Blue's transactions: December 29, 2018 May 14, 2019 August 9, 2019 December 31, 2019 Issued 40,000 shares at P105 per share. Purchased 600 of its ordinary shares at P110 per share. 400 treasury shares were resold at P95 per share. Profit for 2019 is P830,000. Dividends paid P200,000. 34. What is the total outstanding shares? 35. What is the balance of treasury shares? 36. How many shares are entitled to receive dividends? 37. What is the total shareholders' equity? Problem 5 Partners A & B have capital balances of P600,000 and P400,000 and share profits and losses in the ratio of 3:2, respectively, before the admission of C. With the consent of B, A sells one-half of his equity to C, with C paying A the amount of P350,000. 38. What is A's capital balance after the admission of C? 39. What is the total partnership…
Exercise 10-6 (Algo) Record common stock, preferred stock, and dividend transactions (LO10-2, 10-3, 10-5) Italian Stallion has the following transactions during the year related to stockholders’ equity. February 1 Issues 4,900 shares of no-par common stock for $14 per share. May 15 Issues 700 shares of $10 par value, 7% preferred stock for $11 per share. October 1 Declares a cash dividend of $0.70 per share to all stockholders of record (both common and preferred) on October 15. October 15 Date of record. October 31 Pays the cash dividend declared on October 1. Required: Record each of these transactions. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)
Brief Exercise 10-50Preferred and Common Stock Dividends Brookshed Corporation has a single class of common stock and a single class of cumulative preferred stock. The cumulative preferred stock requires the corporation to pay an annual dividend of $11,000 to preferred stockholders. On January 1, 2019, Brookshed's preferred dividends were 1 year in arrears, which means that Brookshed declared neither preferred nor common dividends in 2018. During the next 3 years (2019–2021), Brookshed's board of directors determined they would be able to pay $17,000, $18,000, and $21,000, respectively. Required: Show how these anticipated payments will be split between preferred and common stockholders. If an amount box does not require an entry, leave it blank and if the answer is zero, enter "0".
QUESTION 25 A firm has issued cumulative preferred stock with a $100 par value and a 12 percent annual dividend: For the past two years, the board of directors has decided not to pay a dividend At the end of the current year, the preferred stockholders must be paid prior to paying the common stockholders OA 50/share O&$12/share OC124/share OD$36/share
ces Exercise 11-6A (Static) Accounting for cumulative preferred dividends LO 11-3 When Crossett Corporation was organized in January Year 1, it immediately issued 4,000 shares of $50 par, 6 percent, cumulative preferred stock and 50,000 shares of $20 par common stock. Its earnings history is as follows: Year 1, net loss of $35,000; Year 2, net income of $125,000; Year 3, net income of $215,000. The corporation did not pay a dividend in Year 1. Required a. How much is the dividend arrearage as of January 1, Year 2? b. Assume that the board of directors declares a $25,000 cash dividend at the end of Year 2 (remember that the Year 1 and Year 2 preferred dividends are due). How will the dividend be divided between the preferred and common stockholders? Complete this question by entering your answers in the tabs below. Required A Required B Assume that the Board of directors declares a $25,000 cash dividend at the end of Year 2 (remember that the Year 1 and Year 2 preferred dividends are…
EE 13-1 Swilley Furniture Company has 50,000 shares of cumulative preferred 2% stock, $75 par, and 100,000 shares of $10 par common stock. The following amounts were distributed as dividends: Year 1 $ 45,000 Year 2 123,000 Year 3 130,000 Determine the dividend per share for preferred and common stock for each year.

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