Sumter Pumps Corporation, a manufacturer of industrial pumps, reports the following results for the year ended December 31, 20Y3: Retained earnings, January 1, 20Y3 $59,650,000 Net income 8,160,000 Cash dividends declared 1,000,000 Stock dividends declared 2,600,000 Prepare a retained earnings statement for the year ended December 31, 20Y3. Be sure to complete the statement heading. Refer to the lists of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. For those boxes in which you must enter subtracted negative numbers use a minus sign. LabelsFor the Year Ended December 31, 20Y3December 31, 20Y3Amount DescriptionsChange in retained earningsDividendsExcess of issue price over parIssuance of additional common stockIssuance of additional preferred stockNet incomeNet lossRetained earnings, December 31, 20Y3Retained earnings, January 1, 20Y3 Prepare a retained earnings statement for the year ended December 31, 20Y3. Be sure to complete the statement heading. Refer to the lists of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. For those boxes in which you must enter subtracted negative numbers use a minus sign. Sumter Pumps Corporation Retained Earnings Statement 1 2 3 4 5
Dividend Valuation
Dividend refers to a reward or cash that a company gives to its shareholders out of the profits. Dividends can be issued in various forms such as cash payment, stocks, or in any other form as per the company norms. It is usually a part of the profit that the company shares with its shareholders.
Dividend Discount Model
Dividend payments are generally paid to investors or shareholders of a company when the company earns profit for the year, thus representing growth. The dividend discount model is an important method used to forecast the price of a company’s stock. It is based on the computation methodology that the present value of all its future dividends is equivalent to the value of the company.
Capital Gains Yield
It may be referred to as the earnings generated on an investment over a particular period of time. It is generally expressed as a percentage and includes some dividends or interest earned by holding a particular security. Cases, where it is higher normally, indicate the higher income and lower risk. It is mostly computed on an annual basis and is different from the total return on investment. In case it becomes too high, indicates that either the stock prices are going down or the company is paying higher dividends.
Stock Valuation
In simple words, stock valuation is a tool to calculate the current price, or value, of a company. It is used to not only calculate the value of the company but help an investor decide if they want to buy, sell or hold a company's stocks.
| $59,650,000 | |
| Net income | 8,160,000 |
| Cash dividends declared | 1,000,000 |
| Stock dividends declared | 2,600,000 |
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Sumter Pumps Corporation
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