Financial Accounting
9th Edition
ISBN: 9781259738692
Author: Libby
Publisher: MCG
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Chapter 11, Problem 11.22E
1.
To determine
Prepare the
2.
To determine
Identify the effect of stock dividend on assets, liabilities and stockholder’s equity.
3.
To determine
Explain the way accounts in the stockholder’s equity section of the balance sheet will change if stock split is announced instead of stock dividend.
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At the beginning of the year, the stockholders' equity section of the balance sheet of Solutions Corporation reflected the following:
Common stock ($13 par value; 70,000 shares authorized, 39,000 shares outstanding)
$ 507,000
Additional paid-in capital
127,000
Retained earnings
750,000
On February 1, the board of directors declared a 65 percent stock dividend to be issued April 30. The market value of the stock on February 1 was $16 per share. The market value of the stock on April 30 was $18 per share.
Required:
1. Complete the following table:
SOLUTIONS CORPORATION
Balance Sheet (Partial)
At February 1, This Year
Stockholders’ Equity
Before Stock Dividend
After Stock Dividend
Contributed capital:
Common stock
Additional paid-in capital
Retained earnings
Total stockholders’ equity
3. How a stock split would affect total stockholders’ equity?
Explain how to calculate the after stock dividend to enter on the Balance Sheet.
At the beginning of the year, the stockholders' equity section of the balance sheet of Solutions Corporation reflected the following:
Common stock ($12 par value; 65,000 shares authorized, 30,000 shares outstanding)
$
360,000
Additional paid-in capital
120,000
Retained earnings
580,000
On February 1, the board of directors declared a 60 percent stock dividend to be issued April 30. The market value of the stock on February 1 was $15 per share. The market value of the stock on April 30 was $18 per share.
Required:
1. For comparative purposes, prepare the Stockholders’ Equity section of the balance sheet immediately before the stock dividend and immediately after the stock dividend.
Explain how to calculate the after stock dividend to enter on the balance sheet for the below.
At the beginning of the year, the stockholders' equity section of the balance sheet of Solutions Corporation reflected the following:
Common stock ($12 par value; 65,000 shares authorized, 30,000 shares outstanding) = $360,000Additional paid-capital = $120,000Retained earnings = $580,000
On February 1, the board of directors declared a 60 percent stock dividend to be issued April 30. The market value of the stock on February 1 was $15 per share. The market value of the stock on April 30 was $18 per share.
For comparative purposes, prepare the Stockholders’ Equity section of the balance sheet immediately before the stock dividend and immediately after the stock dividend.
Before Stock Dividend
After Stock Dividend
Contributed capital:
Common stock
$360,000
Additional paid-in capital
120,000
Retained earnings
580,000
Total Stockholders equity
1,060,000
Chapter 11 Solutions
Financial Accounting
Ch. 11 - Prob. 1QCh. 11 - Prob. 2QCh. 11 - Explain each of the following terms: (a)...Ch. 11 - Differentiate between common stock and preferred...Ch. 11 - Explain the distinction between par value and...Ch. 11 - Define additional paid-in capital.Ch. 11 - Prob. 7QCh. 11 - Define treasury stock. Why do corporations acquire...Ch. 11 - How is treasury stock reported on the balance...Ch. 11 - What are the two basic requirements to support the...
Ch. 11 - Prob. 11QCh. 11 - Prob. 12QCh. 11 - Prob. 13QCh. 11 - Prob. 14QCh. 11 - Prob. 15QCh. 11 - Katz Corporation has issued 400,000 shares of...Ch. 11 - Prob. 2MCQCh. 11 - Which of the following statements about stock...Ch. 11 - Prob. 4MCQCh. 11 - Prob. 5MCQCh. 11 - Prob. 6MCQCh. 11 - Prob. 7MCQCh. 11 - Which statement regarding dividends is false? a....Ch. 11 - Prob. 9MCQCh. 11 - Prob. 10MCQCh. 11 - Sources of Equity and Retained Earnings LO11-1...Ch. 11 - Computing the Number of Unissued Shares The...Ch. 11 - Earnings per Share Ratio How is the earnings per...Ch. 11 - Recording the Sale of Common Stock To expand...Ch. 11 - Prob. 11.5MECh. 11 - Determining the Effects of Treasury Stock...Ch. 11 - Determining the Amount of a Dividend Cole Company...Ch. 11 - Prob. 11.8MECh. 11 - Dividend Yield Ratio How is the dividend yield...Ch. 11 - Prob. 11.10MECh. 11 - Prob. 11.11MECh. 11 - Computing Shares Outstanding In a recent annual...Ch. 11 - Computing Number of Shares The charter of Vista...Ch. 11 - Prob. 11.3ECh. 11 - Reporting Stockholders Equity The financial...Ch. 11 - Reporting Stockholders Equity and Determining...Ch. 11 - Finding Amounts Missing from the Stockholders...Ch. 11 - Prob. 11.7ECh. 11 - Reporting Stockholders Equity Ruths Chris...Ch. 11 - Determining the Effects of Transactions on...Ch. 11 - Prob. 11.10ECh. 11 - Prob. 11.11ECh. 11 - Prob. 11.12ECh. 11 - Prob. 11.13ECh. 11 - Preparing the Stockholders Equity Section of the...Ch. 11 - Recording and Analyzing Treasury Stock...Ch. 11 - Prob. 11.16ECh. 11 - Prob. 11.17ECh. 11 - Computing Dividends on Preferred Stock and...Ch. 11 - Prob. 11.19ECh. 11 - Prob. 11.20ECh. 11 - Prob. 11.21ECh. 11 - Prob. 11.22ECh. 11 - Prob. 11.23ECh. 11 - Prob. 11.24ECh. 11 - Prob. 11.25ECh. 11 - Finding Missing Amounts At the end of the year,...Ch. 11 - Preparing the Stockholders Equity Section of the...Ch. 11 - Recording Transactions Affecting Stockholders...Ch. 11 - Prob. 11.4PCh. 11 - Prob. 11.5PCh. 11 - Prob. 11.6PCh. 11 - Analyzing Treasury Stock Transactions Apple Inc....Ch. 11 - Comparing Stock and Cash Dividends Chicago Company...Ch. 11 - Prob. 11.9PCh. 11 - Prob. 11.10PCh. 11 - Recording and Comparing Cash Dividends, Stock...Ch. 11 - Prob. 11.12PCh. 11 - Prob. 11.1APCh. 11 - Prob. 11.2APCh. 11 - Prob. 11.3APCh. 11 - Prob. 11.4APCh. 11 - Recording and Reporting Stockholders Equity...Ch. 11 - Case A: The charter for Rogers, Incorporated,...Ch. 11 - Prob. 1BCOMPCh. 11 - Prob. 1CCOMPCh. 11 - Prob. 1DCOMPCh. 11 - Prob. 11.1CPCh. 11 - Prob. 11.2CPCh. 11 - Prob. 11.3CPCh. 11 - Computing Dividends for an Actual Company A recent...Ch. 11 - Prob. 11.5CPCh. 11 - Prob. 11.6CP
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