Home Products Corp

Essay

Home Products Corp. is authorized to issue 1,000,000 share of $1 par value common stock and 500,000 shares of $5 cumulative preferred stock, respectively. The annual dividend amount on the preferred stock is $.30 per share. At the beginning of 2010, Home Products had 800,000 shares of common and 60,000 shares of preferred stock outstanding. No dividends were paid in 2008 or 2009. The following transactions were incurred by Home Products during 2010 and 2011; no stock was sold during these two years.
2/ 12/10 Declared a total cash dividend of $30,000. The date of record for this dividend will be Feb. 20, and the payment date of will be March 1. Separate accounts are maintained for common and preferred stock dividends.
2/20/10 A list of stockholders is prepared.
3/1/10 Paid the dividend declared on Feb. 12.
12/1/10 Declared a total cash dividend of $64,000.
12/28/10 Paid the dividend declared on Dec. 1.
8/1/11 Declared a 5% stock dividend on the common stock. The market value per common share was $22.50. The date of distribution will be September 7.
9/7/11 Distributed the dividend declared on August 1.
10/6/11 Declared and issued a 2:1 stock split.
12/21/11 Declared a total cash dividend of $68,400. The dividend will be paid on January 16, 2012.
Required:
a. Prepare journal entries for the transactions on the dates specified. If no entry is required for a specific date, write "no entry needed."
b. What dividend amount per share did common stockholders receive on December 28, 2010?
c. What dividend amount per share did common stockholders receive on December 21, 2011?
d. What is the par value of Home Products' common stock after the stock split?