Question

Use the following information for the Exercises below.

[The following information applies to the questions displayed below.]

York’s outstanding stock consists of 80,000 shares of noncumulative 7.5% preferred stock with a $5 par value and also 190,000 shares of common stock with a $1 par value. During its first four years of operation, the corporation declared and paid the following total cash dividends:
  

2015 total cash dividends	$	18,000
2016 total cash dividends		28,000
2017 total cash dividends		300,000
2018 total cash dividends		450,000

Exercise 11-8 Dividends on common and noncumulative preferred stock LO C2

Determine the amount of dividends paid each year to each of the two classes of stockholders: preferred and common. Also compute the total dividends paid to each class for the four years combined. (Round your "Dividend per Preferred Share" answers to 3 decimal places.)

	Par Value per Preferred Share Dividend Rate Dividend per Preferred Share Number of Preferred Shares Preferred Dividend Annual Preferred Dividend: Total Cash Dividend Paid Paid to Preferred Paid to Common Dividends in Arrears at year-end 2015 $18,000 2016 28,000 2017 300,000 2018 450,000 Total: $796,000 $0 $0

Exercise 11-9 Dividends on common and cumulative preferred stock LO C2

Determine the amount of dividends paid each year to each of the two classes of stockholders assuming that the preferred stock is cumulative. Also determine the total dividends paid to each class for the four years combined. (Round your "Dividend per Preferred Share" answers to 3 decimal places.)

	Par Value per Preferred Share Dividend Rate Dividend per Preferred Share Number of Preferred Shares Preferred Dividend Annual Preferred Dividend: Total Cash Dividend Paid Paid to Preferred Paid to Common Dividends in Arrears at year-end 2015 $18,000 2016 28,000 2017 300,000 2018 450,000 Totals $796,000 $0 $0

On October 10, the stockholders’ equity of Sherman Systems appears as follows.
  

Common stock–$10 par value, 74,000 shares authorized, issued, and outstanding	$	740,000
Paid-in capital in excess of par value, common stock		226,000
Retained earnings		880,000
Total stockholders’ equity	$	1,846,000

1. Prepare journal entries to record the following transactions for Sherman Systems.

Purchased 5,200 shares of its own common stock at $27 per share on October 11.

Sold 1,050 treasury shares on November 1 for $33 cash per share.

Sold all remaining treasury shares on November 25 for $22 cash per share.

	Transaction General Journal Debit Credit c Prepare the revised equity section of its balance sheet after the October 11 treasury stock purchase. Revised Equity Section of Balance Sheet After October 11 Total contributed capital 0 Total 0 Total stockholders’ equity $0

Answer 1