Question
In: Finance
The owner's equity accounts for XYZ company are shown here: Common stock ($1 per value) $50,000...
The owner's equity accounts for XYZ company are shown here: Common stock ($1 per value) $50,000 Capital surplus 345,000 Retained earnings 750,000 Total owner’s equity $1,145,000 If XYZ stock currently sells for $25 per share and a 15% stock dividend is declared, what is the amount of the retained earnings on the equity accounts after stock dividend.
Group of answer choices $308,900 $525,000 $562,500 $582,500 None of above is correct.
Solutions
Expert Solution
| Given, | |||||||||
| Common stock ($1 per value) | $50,000 | ||||||||
| Capital surplus | $345,000 | ||||||||
| Retained earnings | $750,000 | ||||||||
| Market price | $25 | ||||||||
| Stock dividend | 15% | ||||||||
| Number of shares outstanding= Common stock/Par value per share | |||||||||
| 50000/1 | |||||||||
| 50000 | |||||||||
| As the rate of dividend is 15% the same would be regarded as small stock dividend and would be accounted for at market price | |||||||||
| Journal entry: | |||||||||
| Debit ($) | Credit ($) | Workings | |||||||
| Retained earnings | 187500 | (50000 shares*15% stock dividend*$25 per share) | |||||||
| Common stock | 7500 | (50000*$1*15%) | |||||||
| Paid in capital in excess of par | 180000 | (50000*($25-$1)*15%) | |||||||
| Therefore, | |||||||||
| Amount of retained earnings after stock dividend= $(750000-187500) | |||||||||
| $562,500 | |||||||||
| Answer: Option C | |||||||||
jeff jeffy answered 3 years agoRelated Solutions
The owners’ equity accounts for Overby International are shown here: Common stock ($1 par value)...
The owners’ equity accounts for Overby International are shown
here:
Common stock ($1 par value) $ 40,000
Capital surplus 188,000
Retained earnings 620,000
Total owners’ equity $ 848,000
a. Assume the company's stock currently sells for $43 per share and
a stock dividend of 15 percent is declared.
How many new shares will be distributed? (Do not round intermediate
calculations and round your answer to the nearest whole number,
e.g., 32.)
New shares issued
...
The owners’ equity accounts for Overby International are shown here: Common stock ($1 par value)...
The owners’ equity accounts for Overby International are shown
here:
Common stock ($1 par value)
$
80,000
Capital surplus
200,000
Retained earnings
660,000
Total owners’ equity
$
940,000
a. Assume the company's stock currently sells for
$47 per share and a stock dividend of 8 percent is declared.
How many new shares will be distributed? (Do not round
intermediate calculations and round your answer to the nearest
whole number, e.g., 32.)
New shares issued
...
The owners’ equity accounts for Overby International are shown here: Common stock ($1 par value)...
The owners’ equity
accounts for Overby International are shown here:
Common stock ($1 par value)
$
55,000
Capital
surplus
218,000
Retained
earnings
720,000
Total owners’
equity
$
993,000
a. Assume the company's stock currently sells for
$25 per share and a stock dividend of 8 percent is declared.
How many new shares will be distributed? (Do not round
intermediate calculations and round your answer to the nearest
whole number, e.g., 32.)
New shares issued
...
The owners’ equity accounts for Vidi International are shown here: Common stock ($.50 par value) $...
The owners’ equity accounts for Vidi International are shown
here:
Common stock ($.50 par value) $ 35,000
Capital surplus 320,000
Retained earnings 708,120
Total owners’ equity $ 1,063,120
a-1 If the company's stock currently sells for $20 per share and
a 15 percent stock dividend is declared, how many new shares will
be distributed? (Do not round intermediate calculations.)
a-2 Show how the equity accounts would change. (Do not round
intermediate calculations.)
b-1 If instead the company declared a 25...
The owners’ equity accounts for Hexagon International are shown here: Common stock ($.40 par value)...
The owners’
equity accounts for Hexagon International are shown here:
Common stock ($.40 par value)
$
32,500
Capital surplus
315,000
Retained earnings
698,120
Total owners’ equity
$
1,045,620
a-1.
The company declares a
four-for-one stock split. How many shares are outstanding now?
(Do not round intermediate calculations.)
New
shares outstanding
a-2.
The company declares a
four-for-one stock split. What is the new par value per share?
(Do not round intermediate calculations and round your
answer to 3...
The owners’ equity accounts for Freya International are shown here: Common stock ($.80 par value) $...
The owners’ equity accounts for Freya International are shown
here: Common stock ($.80 par value) $ 25,000 Capital surplus
370,000 Retained earnings 808,120 Total owners’ equity $ 1,203,120
a-1 If Freya stock currently sells for $30 per share and a 10
percent stock dividend is declared, how many new shares will be
distributed? (Do not round intermediate calculations.) New shares
issued a-2 Show how the equity accounts would change. (Do not round
intermediate calculations.) Common stock $ Capital surplus Retained...
The owners' equity accounts for Vidi International are shown here: Common stock ($.40 par value)...
The owners'
equity accounts for Vidi International are shown here:
Common stock ($.40 par value)
$
40,000
Capital surplus
350,000
Retained earnings
768,120
Total owners’ equity
$
1,158,120
a-1.
If the company
declares a two-for-one stock split, how many shares are outstanding
now? (Do not round intermediate calculations.)
a-2.
What
is the new par value per share? (Do not round intermediate
calculations and round your answer to 3 decimal places, e.g.,
32.161.)
b-1.
If
the company declares a...
The owners’ equity accounts for Vidi International are shown here: Common stock ($.40 par value)...
The owners’ equity accounts for Vidi International are shown
here:
Common stock ($.40 par value)
$
44,000
Capital surplus
360,000
Retained earnings
788,120
Total owners’ equity
$
1,192,120
a-1
If the company's stock currently sells for $30 per share and a
10 percent stock dividend is declared, how many new shares will be
distributed? (Do not round intermediate
calculations.)
a-2
Show how the equity accounts would change. (Do not
round intermediate calculations.)
b-1
If instead the...
The owners’ equity accounts for Freya International are shown here: Common stock ($.40 par value)...
The owners’ equity accounts for Freya International are shown
here:
Common stock ($.40 par value)
$
44,000
Capital surplus
360,000
Retained earnings
788,120
Total owners’ equity
$
1,192,120
a-1
If Freya stock currently sells for $30 per share and a 10
percent stock dividend is declared, how many new shares will be
distributed? (Do not round intermediate
calculations.)
New shares issued
a-2
Show how the equity accounts would change. (Do not
round intermediate calculations.)
...
The owners’ equity accounts for Hexagon International are shown here: Common stock ($.50 par value)...
The owners’ equity accounts for Hexagon International are shown
here:
Common stock ($.50 par value)
$
42,500
Capital surplus
345,000
Retained earnings
758,120
Total owners’ equity
$
1,145,620
a-1.
If the company's stock currently sells for $20 per share and a
15 percent stock dividend is declared, how many new shares will be
distributed? (Do not round intermediate
calculations.)
New shares issued
a-2.
Show the new equity account balances after the stock dividend is
paid....
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- How Can Hominin Evolution be characterized as " mosaic evolution" Use examples of species from the...
- Absorption and Variable Costing Income Statements for Two Months and Analysis During the first month of...
- Mobile and wireless devices are being increasingly used in the Business Administration and Management Industry. write...
- What are the options that might be considered in relation to introducing flexible work practices? What...
- Question 2 : Aggregate Scores: Write a program that opens 2 files, quiz.txt, and hw.txt. The...
- Define the term symbiosis specifically as it applies in a biological context. Compare and contrast parasitism,...
- A research team conducted a study showing that approximately 20% of all businessmen who wear ties...
ADVERTISEMENT