Exam 11: Reporting and Analyzing Equity

On June 30,a company declared a cash dividend of $0.35 per common share to the shareholders of record on July 15.The cash dividend will be paid on July 31.This company has 500,000 shares authorized and 100,000 shares outstanding.Prepare the journal entries required on June 30,July 15 and July 31.

A company has 2,000,000 common shares authorized,400,000 common shares issued,and 15,000 common shares in treasury stock at the current year-end.It paid $0.96 per share cash dividends during the year.The year-end market price of the stock is $15.Calculate (1)the total dividends paid and (2)the dividend yield.

Alto Company issued 7% preferred stock with a $100 par value.This means that:

The date of record is the date that directors vote to pay a cash dividend to shareholders.

Treasury stock is stock that has been authorized,issued,and is outstanding.

A corporation received its charter and began business this year.The company is authorized to issue 500,000 shares of $100 par,6%,noncumulative,nonparticipating preferred stock,and 1,000,000 shares of no-par common stock.The following selected transactions occurred during this year: Prepare journal entries to record these transactions.

Odessa Corporation had 20,000 shares of $2 par value common stock outstanding on July 1.On that day,the board of directors declared a 10% stock dividend when the market value of each share was $9.The stock dividend is to be distributed on July 20 to stockholders of record on July 10.The entry to record the issuance of the shares on July 20 is:

A company has net income of $90,000; its weighted-average common shares outstanding are 18,000.Its dividend per share is $0.45,its market price per share is $88,and its book value per share is $76.Its price-earnings ratio equals:

Explain how to compute book value per common share and discuss how it can be used to analyze the financial condition of a corporation.

The ________ protects stockholders' proportional interest in a corporation by allowing them to purchase their proportional share of any common stock later issued by the corporation.

A corporation had the following stock outstanding when the company's board of directors declared a $55,000 cash dividend during the current year: Allocate the cash dividend between the preferred and common stockholders assuming the preferred stock is cumulative and nonparticipating and dividends are one year in arrears.

Which of the following is true of a stock dividend?

Book value per share:

A stock dividend is a distribution of corporate assets that returns part of the original investment to shareholders.

A company issued 60 shares of $100 par value common stock for $7,000 cash.The total amount of paid-in capital in excess of par is:

A corporation reports the following year-end stockholders' equity: Determine the following: (1)Par value for the preferred stock. (2)Book value per share for both preferred stock and common stock assuming no dividends in arrears.

Fetzer Company declared a $0.55 per share cash dividend.The company has 200,000 shares authorized,190,000 shares issued,and 8,000 shares in treasury stock.The journal entry to record the payment of the dividend is:

Rhoads Corporation is authorized to issue 250,000 shares of $50 par,10%,noncumulative,nonparticipating preferred stock and 5,000,000 shares of no-par common stock.Prepare journal entries to record the following selected transactions that occurred during this year:

A stock ________ keeps stockholder records and prepares official lists of stockholders for stockholder meetings and dividend payments.

A company is authorized to issue 750,000 shares of $2 par value common stock.Prepare journal entries to record the following selected transactions that occurred during the company's first year of operations: