The following information pertains to Diane Company. Assume that all balance sheet amounts represent both average and ending balance figures and that all sales were on credit. Use this information to answer the question that follow. Assets Cash and short-term investments $30,000  Accounts receivable (net) 20,000  Merchandise inventory 15,000  Property, plant, and equipment 185,000  Total assets $250,000    Liabilities and Stockholders' Equity Current liabilities $45,000  Long-term liabilities 70,000  Stockholders' equity—common 135,000  Total liabilities and stockholders' equity $250,000    Income Statement Sales $85,000  Cost of merchandise sold 45,000  Gross profit $40,000  Operating expenses (15,000) Interest expense (5,000) Net income $20,000    Number of shares of common stock outstanding   6,000 Market price per share of common stock   $20 Total dividends paid   $9,000 Net cash flows from operating activities   $30,000 Using the data provided for Diane Company, what are the dividends per common share?

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question

The following information pertains to Diane Company. Assume that all balance sheet amounts represent both average and ending balance figures and that all sales were on credit. Use this information to answer the question that follow.

Assets
Cash and short-term investments $30,000 
Accounts receivable (net) 20,000 
Merchandise inventory 15,000 
Property, plant, and equipment 185,000 
Total assets $250,000 
 
Liabilities and Stockholders' Equity
Current liabilities $45,000 
Long-term liabilities 70,000 
Stockholders' equity—common 135,000 
Total liabilities and stockholders' equity $250,000 
 
Income Statement
Sales $85,000 
Cost of merchandise sold 45,000 
Gross profit $40,000 
Operating expenses (15,000)
Interest expense (5,000)
Net income $20,000 

 

Number of shares of common stock outstanding   6,000
Market price per share of common stock   $20
Total dividends paid   $9,000
Net cash flows from operating activities   $30,000

Using the data provided for Diane Company, what are the dividends per common share?  

Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps

Blurred answer
Knowledge Booster
Ratio Analysis
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education