The equity section from the December 31, 2023 balance sheet of Kentucky Corporation appeared as follows: Contributed capital: Common shares, 52,600 shares authorized; 23,280 and 20,900 shares issued and outstanding, respectively. Retained earnings The following transactions occurred during 2024 (assume the retirements were the first ever recorded by Kentucky): Jan. 5 A $1.30 per share cash dividend was declared, and the date of record was five days later. Mar. 20 1,500 common shares were repurchased and retired at $28.60 per share. Apr. 5 A $1.00 per share cash dividend was declared, and the date of record was five days later. July 5 A $2.20 per share cash dividend was declared, and the date of record was five days later. July 31 A 20.00% share dividend was declared when the market value was $38.00 per share. Aug. 14 The share dividend was issued. Oct. 5 A $1.90 per share cash dividend was declared, and the date of record was five days later.

The equity section from the December 31, 2023 balance sheet of Kentucky Corporation appeared as follows: Contributed capital: Common shares, 52,600 shares authorized; 23,280 and 20,900 shares issued and outstanding, respectively. Retained earnings The following transactions occurred during 2024 (assume the retirements were the first ever recorded by Kentucky): Jan. 5 A $1.30 per share cash dividend was declared, and the date of record was five days later. Mar. 20 1,500 common shares were repurchased and retired at $28.60 per share. Apr. 5 A $1.00 per share cash dividend was declared, and the date of record was five days later. July 5 A $2.20 per share cash dividend was declared, and the date of record was five days later. July 31 A 20.00% share dividend was declared when the market value was $38.00 per share. Aug. 14 The share dividend was issued. Oct. 5 A $1.90 per share cash dividend was declared, and the date of record was five days later.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter16: Retained Earnings And Earnings Per Share

Section: Chapter Questions

Problem 3P: On January 1, 2019, Kittson Company had a retained earnings balance of 218,600. It is subject to a...

See similar textbooks

Similar questions

Anoka Company reported the following selected items in the shareholders equity section of its balance sheet on December 31, 2019, and 2020: In addition, it listed the following selected pretax items as a December 31, 2019 and 2020: The preferred shares were outstanding during all of 2019 and 2020; annual dividends were declared and paid in each year. During 2019, 2,000 common shares were sold for cash on October 4. During 2020, a 20% stock dividend was declared and issued in early May. At the end of 2019 and 2020, the common stock was selling for 25.75 and 32.20, respectively. The company is subject to a 30% income tax rate. Required: 1. Prepare the comparative 2019 and 2020 income statements (multiple-step), and the related note that would appear in Anokas 2020 annual report. 2. Next Level Compute the price/earnings ratio for 2020. How does this compare to 2019? Why is it different?
Contributed Capital Adams Companys records provide the following information on December 31, 2019: Additional information: 1. Common stock has a 5 par value, 50,000 shares are authorized, 15,000 shares have been issued and are outstanding. 2. Preferred stock has a 100 par value, 3,000 shares are authorized, 800 shares have been issued and are outstanding. Two hundred shares have been subscribed at 120 per share. The stock pays an 8% dividend, is cumulative, and is callable at 130 per share. 3. Bonds payable mature on January 1, 2023. They carry a 12% annual interest rate, payable semiannually. Required: Prepare the Contributed Capital section of the December 31, 2019, balance sheet for Adams. Include appropriate parenthetical notes.
Selected transactions completed by Equinox Products Inc. during the fiscal year ended December 31, 20Y8, were as follows: A. Issued 15,000 shares of 20 par common stock at 30, receiving cash. B. Issued 4,000 shares of 80 par preferred 5% stock at 100, receiving cash. C. Issued 500,000 of 10-year, 5% bonds at 104, with interest payable semiannually. D. Declared a quarterly dividend of 0.50 per share on common stock and 1.00 per share on preferred stock. On the date of record, 100,000 shares of common stock were outstanding, no treasury shares were held, and 20,000 shares of preferred stock were outstanding. E. Paid the cash dividends declared in (D). F. Purchased 8,000 shares of treasury common stock at 33 per share. G. Declared a 1.00 quarterly cash dividend per share on preferred stock. On the date of record, 20,000 shares of preferred stock had been issued. H. Paid the cash dividends to the preferred stockholders. I. Sold, at 38 per share, 2,600 shares of treasury common stock purchased in (F). J. Recorded the payment of semiannual interest on the bonds issued in (C) and the amortization of the premium for six months. The amortization is determined using the straight-line method. Instructions 1. Journalize the selected transactions. 2. After all of the transactions for the year ended December 31, 20Y8, had been posted [including the transactions recorded in part (1) and all adjusting entries], the data that follow were taken from the records of Equinox Products Inc. Income statement data: Advertising expense 150,000 Cost of goods sold 3,700,000 Delivery expense 30,000 Depreciation expenseoffice buildings and equipment 30,000 Depreciation expensestore buildings and equipment 100,000 Income tax expense 140,500 Interest expense 21,000 Interest revenue 30,000 Miscellaneous administrative expense 7,500 Miscellaneous selling expense 14,000 Office rent expense 50,000 Office salaries expense 170,000 Office supplies expense 10,000 Sales 5,313,000 Sales commissions 185,000 Sales salaries expense 385,000 Store supplies expense 21,000 Retained earnings and balance sheet data: Accounts payable 194,300 Accounts receivable 545,000 Accumulated depreciationoffice buildings and equipment 1,580,000 Accumulated depreciationstore buildings and equipment 4,126,000 Allowance for doubtful accounts 8,450 Bonds payable, 5%, due in 10 years 500,000 Cash 282,850 Common stock, 20 par (400,000 shares authorized; 100,000 shares issued, 94,600 outstanding) 2,000,000 Dividends: Cash dividends for common stock 155,120 Cash dividends for preferred stock 100,000 Goodwill 700,000 Income tax payable 44,000 Interest receivable 1,200 Inventory (December 31, 20Y8),at lower of cost (FIFO) or market 778,000 Office buildings and equipment 4,320,000 Paid-in capital from sale of treasury stock 13,000 Excess of issue price over parcommon stock 886,800 Excess of issue price over parpreferred stock 150,000 Preferred 5% stock, 80 par (30,000 shares authorized; 20,000 shares issued) 1,600,000 Premium on bonds payable 19,000 Prepaid expenses 27,400 Retained earnings, January 1, 20Y8 8,197,220 Store buildings and equipment 12,560,000 Treasury stock (5,400 shares of common stock at cost of 33 per share) 178,200 A. Prepare a multiple-step income statement for the year ended December 31, 20Y8. B. Prepare a retained earnings statement for the year ended December 31, 20Y8. C. Prepare a balance sheet in report form as of December 31, 20Y8.
Selected transactions completed by Equinox Products Inc. during the fiscal year ended December 31, 2016, were as follows: a. Issued 15,000 shares of 20 par common stock at 30, receiving cash. b. Issued 4, 000 shares of 80 par preferred 5% stock at 100, receiving cash. c. Issued 500,000 of 10-year, 5% bonds at 104, with interest payable semiannually. d. Declared a quarterly dividend of 0.50 per share on common stock and 1.00 per share on preferred stock. On the date of record, 100,000 shares of common stock were outstanding, no treasury shares were held, and 20,000 shares of preferred stock were outstanding. e. Paid the cash dividends declared in (d). f. Purchased 7,500 shares of Solstice Corp. at 40 per share, plus a 150 brokerage commission. The investment is classified as an available-for-sale investment. g. Purchased 8,000 shares of treasury common stock at 33 per share. h. Purchased 40,000 shares of Pinkberry Co. stock directly from the founders for 24 per share. Pinkberry has 125,000 shares issued and outstanding. Equinox Products Inc. treated the investment as an equity method investment. i. Declared a 1.00 quarterly cash dividend per share on preferred stock. On the date of record, 20,000 shares of preferred stock had been issued. j. Paid the cash dividends to the preferred stockholders. k. Received 27,500 dividend from Pinkberry Co. investment in (h). l. Purchased 90,000 of Dream Inc. 10-year, 5% bonds, directly from the issuing company, at their face amount plus accrued interest of 37 5. The bonds are classified as a held-to-maturity long -term investment. m. Sold, at 38 per share, 2,600 shares of treasury common stock purchased in (g). n. Received a dividend of 0 .60 per share from the Solstice Corp. investment in (f). o. Sold 1,000 shares of Solstice Corp. at 45, including commission. p. Recorded the payment of semiannual interest on the bonds issue d in (c) and the amortization of the premium for six months. The amortization is determined using the straight-line method . q. Accrued interest for three months on the Dream Inc. bonds purchased in (I). r. Pinkberry Co. recorded total earnings of 240 ,000. Equinox Products recorded equity earnings for its share of Pinkberry Co. net income. s. The fair value for Solstice Corp. stock was 39. 02 per share on December 31, 2016. The investment is adjusted to fair value , using a valuation allowance account. Assume Valuation Allowance for Available-for-Sale Investments h ad a beginning balance of zero. Instructions 1. Journalize the selected transactions. 2. After all of the transaction s for the year ended December 31, 201 6, had been poste d [including the transactions recorded in part (1) and all adjusting entries), the data that follows were taken from the records of Equinox Products Inc. a. Prepare a multiple-step in come statement for the year ended December 31, 201 6, concluding with earnings per share . In computing earnings per share, assume that the average number of common shares outstanding was 100,000 and preferred dividends were 100,000. ( Round earnings per share to the nearest cent.) b. Prepare a retained earnings statement for the year ended December 31, 20 6. c. Prepare a balance sheet in report form as of December 31, 2016.
The equity section from the December 31, 2023 balance sheet of Kentucky Corporation appeared as follows: Contributed capital: Common shares, 54,100 shares authorized; 23,040 and 21,300 shares issued and outstanding, respectively. Retained earnings 2024 2023 $677,760 $602,790 521,900 476,900 The following transactions occurred during 2024 (assume the retirements were the first ever recorded by Kentucky): Jan. 5 A $1.40 per share cash dividend was declared, and the date of record was five days later. Mar. 20 2,100 common shares were repurchased and retired at $28.30 per share. Apr. 5 A $0.70 per share cash dividend was declared, and the date of record was five days later. July 5 A $1.90 per share cash dividend was declared, and the date of record was five days later.. July 31 A 20.00x share dividend was declared when the market value was $35.00 per share. Aug. 14 The share dividend was issued. Oct. 5 A $1.50 per share cash dividend was declared, and the date of record was five days…
On January 1, 2024, Accustart Corporation had 84,000 common shares, recorded at $659,400, and retained earnings of $1 million. During the year, the following transactions occurred: Apr. 2 June 15 Aug. 21 Nov. Dec. 20 (a) Issued 5,000 common shares at $20 per share. Declared a cash dividend of $0.25 per share to common shareholders of record on June 30, payable on July 10. Declared a 5% stock dividend to common shareholders of record on September 5, distributable on September 20. The shares were trading for $22 a share on August 21, $24 on September 5, and $27 on September 20. Issued 2,900 common shares at $24 per share. Declared a cash dividend of $0.30 per share to common shareholders of record on December 31, payable on January 10. Your answer is partially correct. Record the above transactions for 2024. (List all debit entries before credit entries. Record journal entries in the order presented in the problem. Credit account titles are automatically indented when the amount is…
On January 1, 2024, Lawn Corporation had 87,000 common shares, recorded at $626,400, and retained earnings of $1 million. During the year, the following transactions occurred: Apr. 2 June 15. Aug. 21 Nov. 1 Dec. 20 (a) Issued 5,000 common shares at $20 per share. Declared a cash dividend of $0.15 per share to common shareholders of record on June 30, payable on July 10. Declared a 5% stock dividend to common shareholders of record on September 5, distributable on September 20. The shares were trading for $21 a share on August 21, $24 on September 5, and $26 on September 20. Issued 3,100 common shares at $25 per share. Declared a cash dividend of $0.20 per share to common shareholders of record on December 31, payable on January 10. Record the above transactions for 2024. (List all debit entries before credit entries. Record journal entries in the order presented in the problem. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no…
On January 1, 2024, Lawn Corporation had 87,000 common shares, recorded at $626,400, and retained earnings of $1 million. During the year, the following transactions occurred: Apr. 2 June 15 Aug 21 Nov. 1 Dec 20 (a) issued 5,000 common shares at $20 per share. Declared a cash dividend of $0.15 per share to common shareholders of record on June 30, payable on July 10. Declared a 5% stock dividend to common shareholders of record on September 5, distributable on September 20. The shares were trading for $21 a share on August 21, $24 on September 5, and $26 on September 20. Date: Issued 3,100 common shares at $25 per share. Declared a cash dividend of $0.20 per share to common shareholders of record on December 31, payable on January 10. Your answer is partially correct. Record the above transactions for 2024. (List all debit entries before credit entries. Record journal entries in the order presented in the problem. Credit account titles are automatically indented when the amount is…
During the year ended December 31, 2024, Rakai Corporation, a public company, had the following transactions related to investments held for trading purposes: Feb. 1 Purchased 575 IBF common shares for $25,300. Mar. 1 Purchased 1,500 Raimundo common shares for $48,000. Apr. 1 Purchased $200,000 of CRT 3% bonds at par. Interest is payable semi-annually on April 1 and October 1. July 1 Received a cash dividend of $1.50 per share on the IBF common shares. Aug. 1 Sold 250 IBF common shares at 548 per share. Oct. 1 Received the semi-annual interest on the CRT bonds. 1 Sold the CRT bonds for $205,000. Dec. 31 The fair values of the IBF and Raimundo common shares were $50 and $28 per share, respectively. Instructions Record the transactions and any required year-end adjusting entries. Show the financial statement presentation of the investments and any related accounts in the financial statements for the year ended December 31, 2024.
Crane Ltd. began operations on January 2, 2024. During the year, the following transactions affected shareholders' equity: 1. Crane's articles of incorporation authorize the issuance of 2.5 million common shares and the issuance of 253,000 preferred shares, the latter of which pay an annual dividend of $3.0 per share. 2. A total of 303,000 common shares were issued for $6 a share, 3. A total of 35,000 preferred shares were issued for $10 per share. 4. The full annual dividend on the preferred shares was declared. 5. The dividend on the preferred shares was paid. 6. A dividend of $0.12 per share was declared on the common shares but was not yet paid. 7. The company had net income of $170,000 for the year. (Assume sales of $500,000 and total operating expenses of $330,000.) 8. The dividends on the common shares were paid. 9. The closing entry for the Dividends Declared account was prepared.
The following transactions occurred for Rothman Corp. during 2024, its first quarter of operations (fiscal year ending Dec. 31): 1. 2. On Oct. 5, Rothman issued 2000 shares of $10 par common stock in an IPO and 400 shares of $40 par preferred stock for a lump sum of $85,000 cash. The values of the common and preferred stock were appraised separately at $30 and $50 per share, respectively. On Oct. 20, Rothman declared an 80% common stock dividend, when the market value per share of the common stock was $32. 3. On Dec. 5, the common stock dividend was issued. 4. On Dec. 20, a 3-for-1 stock split occurred for common stock. 5. On Dec. 30, Rothman purchased 100 shares of its own common stock for $14 per share. Instructions: A. Prepare the general journal entries to record each of the above transactions. B. Determine the number of common shares (1) issued and (2) outstanding at Dec. 31, 2024.
On January 1, 2021, Eugene Co. had retained earnings of P1,240,000. During 2021, the co. earned net income of P456,000. The following transactions occurred:a. Cash dividends of P12 per share on 42,000 shares of ordinary shares were declared and paid.b. A small share dividend was declared and issued. The dividend consisted of 6,620 shares of P25 par ordinary share. On the date of declaration, the market price of the company’s ordinary share was P34 per share.c. The co. recalled and retired 12,100 shares of P50 par preferred share. The call price was P93 per share; the share had originally been issued for P80 per share. d. The Eugene discovered that it had erroneously recorded depreciation expense of P200,000 in 2019 for both financial and tax reporting. The correct depreciation for 2019 had been P275,000. This is considered a material error. Assume tax rate of 25%. The balance of retained earnings on December 31, 2021: