Question

Publishing Inc. was established on February 21, 2020. is authorized to issue 800,000 shares of $2.00 par value common stock and by December 31, 2020, Stafford had 200,000 shares issued & outstanding and Paid-In Capital of $1,800,000. On January 3, 2021, when the common stock was trading for $15/share, Stafford declared a 14% stock dividend.  Which of the following would be included in the journal entry to record the declaration and payment of the stock dividend?

For Larry’s company this year’s cash flow statement reports net operating cash flows $30,000; net investing cash flows ($50,000); and net financing cash flows $80,000. Last year’s balance sheet reported cash was $40,000. What amount of cash will be reported in the current year’s balance sheet?

Consider the following account balances of the Law Firm at the end of the year:

Accounts Payable	$ 4,400
Salaries Expense	12,800
Cash	1,700
Common Stock	2,400
Service Revenue	8,300
Supplies	4,300
Retained Earnings	1,100
Utilities Expense	5,000

How many of these accounts would appear in year-end income statement?

Answer 1

1.

Stock dividend for shares = 200,000 * 14% = 28000 shares

Stock dividend in amount = 28000 *15 = $ 420,000

Par value = 28000 * 2 = $ 56,000

Date	Particulars	Debit ($)	Credit ($)
	Retained earnings	420,000
	Common stock, $ 2 par value		56,000
	Additional paid in capital		364,000
	(To record declaration and payment of dividend)

2.

Cash from operations	30,000
Net investing cash flows	(50,000)
Net financing cash flows	80,000
Cash flows	60,000
Opening cash balance	40,000
Cash balance at the end	100,000

Cash to be reported = $ 100,000

3.

The assets,liablities and capital appear in the balance sheet. Expenses and income are reported in income statement. Supplies is assumed to be current asset here. They are assets until used.

From above, salaries expense, service revenue and utilities expense would appear in year-end income statement.