Question

1.

Dividends Per Share

Imaging Inc., a developer of radiology equipment, has stock outstanding as follows: 21,000 shares of cumulative preferred 1% stock, $110 par, and 70,000 shares of $20 par common. During its first four years of operations, the following amounts were distributed as dividends: first year, $15,540; second year, $40,660; third year, $75,040; fourth year, $142,100.

Compute the dividends per share on each class of stock for each of the four years. Round all answers to two decimal places. If no dividends are paid in a given year, enter "0".

	1st Year	2nd Year	3rd Year	4th Year
Preferred stock (dividend per share)	$	$	$	$
Common stock (dividend per share)	$	$	$	$

2.

Issuing Stock

Work Place Products Inc., a wholesaler of office products, was organized on July 1 of the current year, with an authorization of 100,000 shares of 3% preferred stock, $65 par and 600,000 shares of $20 par common stock. The following selected transactions were completed during the first year of operations:

Journalize the transactions.

July. 1. Issued 95,000 shares of common stock at par for cash.

July. 1

July. 1 Issued 650 shares of common stock at par to an attorney in payment of legal fees for organizing the corporation.

July. 1

Aug. 7. Issued 20,000 shares of common stock in exchange for land, buildings, and equipment with fair market prices of $73,000, $398,000, and $89,000, respectively.

For a compound transaction, if an amount box does not require an entry, leave it blank.

Aug. 7

Sept. 20. Issued 30,000 shares of preferred stock at $76 for cash.

For a compound transaction, if an amount box does not require an entry, leave it blank.

Sept. 20

3.

Entries for Stock Dividends

Senior Life Co. is an HMO for businesses in the Portland area. The following account balances appear on the balance sheet of Senior Life Co.: Common stock (220,000 shares authorized; 7,000 shares issued), $50 par, $350,000; Paid-In Capital in excess of par— common stock, $35,000; and Retained earnings, $3,500,000. The board of directors declared a 2% stock dividend when the market price of the stock was $67 a share. Senior Life Co. reported no income or loss for the current year.

If an amount box does not require an entry, leave it blank. If no entry is required, select "No entry required" from the dropdown.

a1. Journalize the entry to record the declaration of the dividend, capitalizing an amount equal to market value.

a2. Journalize the entry to record the issuance of the stock certificates.

b. Determine the following amounts before the stock dividend was declared: (1) total paid-in capital, (2) total retained earnings, and (3) total stockholders' equity.

Total paid-in capital	$
Total retained earnings	$
Total stockholders' equity	$

c. Determine the following amounts after the stock dividend was declared and closing entries were recorded at the end of the year: (1) total paid-in capital, (2) total retained earnings, and (3) total stockholders' equity.

Total paid-in capital	$
Total retained earnings	$
Total stockholders' equity	$

Answer 1