The stockholders’ equity accounts of Flint Corporation on January 1, 2017, were as follows.Preferred Stock (8%, $100 par noncumulative, 4,950 shares authorized) $297,000Common Stock ($4 stated value, 321,000 shares authorized) 1,070,000Paid-in Capital in Excess of Par Value—Preferred Stock 14,850Paid-in Capital in Excess of Stated Value—Common Stock 513,600Retained Earnings 686,500Treasury Stock (4,950 common shares) 39,600During 2017, the corporation had the following transactions and events pertaining to its stockholders’ equity.Feb.1 Issued 4,950 shares of common stock for $29,700.Mar.20 Purchased 1,400 additional shares of common treasury stock at $7 per share.Oct.1 Declared a 8% cash dividend on preferred stock, payable November 1.Nov.1 Paid the dividend declared on October 1.Dec.1 Declared a $0.60 per share cash dividend to common stockholders of record on December 15, payable December 31, 2017.Dec.31 Determined that net income for the year was $276,100. Paid the dividend declared on December 1. Preferred Stock1/1 Bal.297,00012/31 Bal.297,000Common Stock1/1 Bal.1,070,0002/119,80012/31 Bal.1,089,800Paid-in Capital in Excess of Par Value-Preferred Stock1/1 Bal.14,85012/31 Bal.14,850Paid-in Capital in Excess of Stated Value-Common Stock1/1 Bal.513,600 1/1 Bal.513,6002/19,90012/31 Bal.523,500Retained Earnings12/31349,2001/1 Bal.686,50012/31276,10012/31 Bal.962,600Cash Dividends10/124,00012/31173,40012/1149,40012/31 Bal.

The dividend is declared from the retained earnings of the business. Retained earnings 12/31 Dividends 185,100 1/1 Bal 686,500 12/31 Profits 276,100 12/31 Bal 777,500 Cash dividends 10/1 Dividend payable $23,760 12/31 Retained earnings $185,100 12/1 Dividend payable 161,340 185,100 185,100 Working notes: Oct 10, Number of preferred shares issued and outstanding = 297,000 / 100 = 2,970 shares Cash dividend = 2,970 * 100 * 8% = $23,760 Dec 1, Number of common shares issued and outstanding = (1,070,000 / 4) – 4,950 + 4,950 + 1,400 = 268,900 Cash dividend = 268,900 * $0.60 = $161,340

Answered: The stockholders’ equity accounts of…

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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The stockholders’ equity accounts of Flint Corporation on January 1, 2017, were as follows.

Preferred Stock (8%, $100 par noncumulative, 4,950 shares authorized)		$297,000
Common Stock ($4 stated value, 321,000 shares authorized)		1,070,000
Paid-in Capital in Excess of Par Value—Preferred Stock		14,850
Paid-in Capital in Excess of Stated Value—Common Stock		513,600
Retained Earnings		686,500
Treasury Stock (4,950 common shares)		39,600

During 2017, the corporation had the following transactions and events pertaining to its stockholders’ equity.

Feb.	1	Issued 4,950 shares of common stock for $29,700.
Mar.	20	Purchased 1,400 additional shares of common treasury stock at $7 per share.
Oct.	1	Declared a 8% cash dividend on preferred stock, payable November 1.
Nov.	1	Paid the dividend declared on October 1.
Dec.	1	Declared a $0.60 per share cash dividend to common stockholders of record on December 15, payable December 31, 2017.
Dec.	31	Determined that net income for the year was $276,100. Paid the dividend declared on December 1.

Preferred Stock
1/1 Bal.
297,000
12/31 Bal.
297,000
Common Stock
1/1 Bal.
1,070,000
2/1
19,800
12/31 Bal.
1,089,800
Paid-in Capital in Excess of Par Value-Preferred Stock
1/1 Bal.
14,850
12/31 Bal.
14,850
Paid-in Capital in Excess of Stated Value-Common Stock
1/1 Bal.
513,600

1/1 Bal.
513,600
2/1
9,900
12/31 Bal.
523,500
Retained Earnings
12/31
349,200
1/1 Bal.
686,500
12/31
276,100
12/31 Bal.
962,600
Cash Dividends
10/1
24,000
12/31
173,400
12/1
149,400
12/31 Bal.

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