Exam 11: Corporations: Organization, Stock Transactions, and Dividends

Sabas Company has 20,000 shares of $100 par, 2% cumulative preferred stock and 100,000 shares of $50 par common stock. The following amounts were distributed as dividends: Year 1: $10,000 Year 2: 45,000 Year 3: 90,000 Determine the dividends per share for preferred and common stock for the second year.

The issuance of common stock affects both paid-in capital and retained earnings.

The declaration and issuance of a stock dividend does not affect the total amount of a corporation's assets, liabilities, or stockholders' equity.

Which of the following is the appropriate general journal entry to record the declaration of cash dividends?

For the current year ended, ABC had the following transactions: - Issued 10,000 shares of $2.00 par value common stock for $12.00 per share. - Issued 3,000 shares of $50 par value 6% preferred stock for $70 per share. - Purchased 1,000 shares of previously issued common stock for $15.00 per share. - Reported net income of $200,000. - Declared and paid a total dividend of $40,000. Assume that retained earnings had a beginning balance of $75,000. -$100,000

How is treasury stock shown on the balance sheet?

On February 1 of the current year, Motor, Inc. issued 700 shares of $2 par common stock to an attorney in return for preparing and filing the articles of incorporation. The value of the services is $9,600. Journalize this transaction.

Under the corporate form of business organization,

The following transactions took place for the XYZ Corporation: November 12 - Declared a total cash dividend of $45,000 for stockholders of record November 20 payable on December 1. Record the journal entries required by these events. Briefly describe the significance of November 20.

A sale of treasury stock may result in a decrease in paid-in capital. All decreases should be charged to Paid-In Capital from Sale of Treasury Stock.

The main source of paid-in capital is from issuing stock.

For the current year ended, ABC had the following transactions: - Issued 10,000 shares of $2.00 par value common stock for $12.00 per share. - Issued 3,000 shares of $50 par value 6% preferred stock for $70 per share. - Purchased 1,000 shares of previously issued common stock for $15.00 per share. - Reported net income of $200,000. - Declared and paid a total dividend of $40,000. Assume that retained earnings had a beginning balance of $75,000. -$150,000

Match each of the following stockholders' equity concepts to the appropriate term a-h). -Creditors cannot pursue stockholders' personal assets to satisfy claims

When common stock is issued in exchange for land, the land should be recorded in the accounts at the par value of the stock issued.

Match each of the following stockholders' equity concepts to the most appropriate term a-h). -A financial institution that records and maintains records of another company's stockholders.

When no-par stock is issued, Common Stock is credited for the selling price of the stock issued.

The stock dividends distributable account is listed in the current liability section of the balance sheet.

Match each of the following stockholders' equity concepts to the most appropriate term a-h). -The number of shares currently held by stockholders

Macy Company has 10,000 shares of 2% cumulative preferred stock of $50 par and 25,000 shares of $75 par common stock. The following amounts were distributed as dividends: Determine the dividends per share for preferred and common stock for each year.

A company had stock outstanding as follows during each of its first three years of operations: 2,500 shares of 10%, $100 par, cumulative preferred stock and 50,000 shares of $10 par common stock. The amounts distributed as dividends are presented below. Determine the total and per-share dividends for each class of stock for each year by completing the schedule.