Question

In: Accounting

17/ A corporation declared and issued a 20% stock dividend on October 1. The following information...

17/ A corporation declared and issued a 20% stock dividend on October 1. The following information was available immediately prior to the dividend:

Retained earnings $ 760,000
Shares issued and outstanding 61,000
Market value per share $ 16
Par value per share $ 5


The amount that contributed capital will increase (decrease) as a result of recording this stock dividend is:

Multiple Choice

$61,000.

$0.

$(195,200).

$(61,000).

$195,200.

18/ Fetzer Company declared a $0.45 per share cash dividend. The company has 440,000 shares authorized, 418,000 shares issued, and 17,600 shares in treasury stock. The journal entry to record the payment of the dividend is:

Multiple Choice

Debit Common Dividends Payable $188,100; credit Cash $188,100.

Debit Retained Earnings $180,180; credit Common Dividends Payable $180,180.

Debit Common Dividends Payable $180,180; credit Cash $180,180.

Debit Retained Earnings $198,000; credit Common Dividends Payable $198,000.

Debit Retained Earnings $188,100; credit Common Dividends Payable $188,100.

19/ A corporation sold 14,500 shares of its $10 par value common stock at a cash price of $14 per share. The entry to record this transaction would include:

Multiple Choice

A debit to Paid-in Capital in Excess of Par Value, Common Stock for $58,000.

A debit to Cash for $145,000.

A credit to Common Stock for $145,000.

A credit to Common Stock for $203,000.

A credit to Paid-in Capital in Excess of Par Value, Common Stock for $203,000.

20/ Hutter Corporation declared a $0.50 per share cash dividend on its common shares. The company has 44,000 shares authorized, 23,400 shares issued, and 17,600 shares of common stock outstanding. The journal entry to record the dividend declaration is:

Multiple Choice

Debit Retained Earnings $8,800; credit Common Dividends Payable $8,800.

Debit Common Dividends Payable $8,800; credit Cash $8,800.

Debit Retained Earnings $11,700; credit Common Dividends Payable $11,700.

Debit Common Dividends Payable $11,700; credit Cash $11,700.

Debit Retained Earnings $22,000; credit Common Dividends Payable $22,000.

Solutions

Expert Solution

Answer

17.

Stock Dividend = Outstanding shares *20%

Stock Dividend = 12,200 Shares (61,000 Shares * 20%)

Value of Stock Dividend = No. of Shares * Market Value per share

= 12,200 Shares * $16

Increase in Contributed Capital = $195,200

18.

Answer = Debit Common Dividends Payable $180,180; credit Cash $180,180

Shares for Cash dividend = Issued Shares – Treasury Stock

= 418,000 – 17,600 Shares

Shares for Cash dividend = 400,400 Shares

Cash dividend = 400,400 Shares * $0.45 per share

Cash dividend = $180,180

19.

Answer = A credit to Common Stock for $145,000

Cash (Dr.)                                                    $203,000 (14,500 shares * $14)

Paid in capital in excess of par (Cr.)           $58,000 (14,500 Shares * $4)

Common Stock (Cr.)                                   $145,000 (14,500 Shares * $10)

20.

Answer = Debit Retained Earnings $8,800; credit Common Dividends Payable $8,800

Dividend = Outstanding shares * $0.5 per share

= $8,800 (17,600 Shares * $0.5)

ekkarill92 answered 1 year ago
Next > < Previous

Related Solutions

Part a On October 1, 2021, Helmsmith Corporation declared and issued a 10% common stock dividend....
Part a On October 1, 2021, Helmsmith Corporation declared and issued a 10% common stock dividend. Before this date, Helmsmith had 80,000 shares of $1 par common stock outstanding. The market price of Helmsmith Corporation’s common stock on the date of declaration was $10 per share. Required Show Helmsmith’s journal entries to record the common stock dividend on: 1) The date of declaration 2) The date of record 3) The date of distribution/payment Part b Despot declared a property dividend...
On October 1, 2021, Helmsmith Corporation declared and issued a 10% common stock dividend. Before this...
On October 1, 2021, Helmsmith Corporation declared and issued a 10% common stock dividend. Before this date, Helmsmith had 80,000 shares of $1 par common stock outstanding. The market price of Helmsmith Corporation’s common stock on the date of declaration was $10 per share. Required Show Helmsmith’s journal entries to record the common stock dividend on: 1) The date of declaration 2) The date of record 3) The date of distribution/payment
On October 31, 2017, Lexington Corp. declared and issued a 12% common stock dividend. Prior to...
On October 31, 2017, Lexington Corp. declared and issued a 12% common stock dividend. Prior to this dividend, Lexington had 302,000 shares of $0.001 par value common stock issued and outstanding. The fair value of Lexington's common stock was $16.75 per share on October 31, 2017. As a result of this stock dividend, the company's total stockholders' equity please explain in details
The company with the common equity accounts shown here has declared a stock dividend of 20...
The company with the common equity accounts shown here has declared a stock dividend of 20 percent at a time when the market value of its stock is $30 per share. Common stock ($1 par value) $ 460,000 Capital surplus 861,000 Retained earnings 3,870,800 Total owners' equity $ 5,191,800 What would be the number of shares outstanding, after the distribution of the stock dividend? (Do not round intermediate calculations.) New shares outstanding             What would the equity accounts be...
In the past year, Gosser Corporation declared a 10% stock dividend, and Jenks, Inc. announced a...
In the past year, Gosser Corporation declared a 10% stock dividend, and Jenks, Inc. announced a 2-for-1 stock split. Your parents own 100 shares of each company's $50 par value common stock. During a recent phone call, your parents ask you, as an accounting student, to explain the differences between the two events. Make sure to include in the explanation what your opinion is on these actions and which you would prefer for your own investments.
On May 1, Year 1, Love Corporation declared a $61,500 cash dividend to be paid on...
On May 1, Year 1, Love Corporation declared a $61,500 cash dividend to be paid on May 31 to shareholders of record on May 15. Required a. Record the events occurring on May 1, May 15, and May 31 in a horizontal statements model. In the Cash Flow column, indicate whether the item is an operating activity (OA), investing activity (IA), or financing activity (FA). Use NA to indicate that an element was not affected by the event. b. Prepare...
The company declared a 3% common stock dividend on December 1, and would like you to...
The company declared a 3% common stock dividend on December 1, and would like you to compute the following pieces of missing information. The market value of the common shares is $24.00 on December 1, and is $30.00 on the actual distribution date of the stock, December 31. Fill in the missing information in the following table, using the information given and your work on the other panels. All “before” items are before the stock dividend was declared. All “after”...
1.) On June 13, the board of directors of Siewert Inc. declared a 5% stock dividend...
1.) On June 13, the board of directors of Siewert Inc. declared a 5% stock dividend on its 120 million, $5 par, common shares, to be distributed on July 1. The market price of Siewert common stock was $23 on June 13. Prepare a journal entry that summarizes the declaration and distribution of the stock dividend. 2.) On June 13, the board of directors of Siewert Inc. declared a 2-for-1 stock split on its 100 million, $1.00 par, common shares,...
A company declared a dividend on Tuesday, August 27th. The stock will go ex-dividend on Thursday,...
A company declared a dividend on Tuesday, August 27th. The stock will go ex-dividend on Thursday, September 12th, and the record date is Monday, September 16th. Finally, the payment date will be Thursday, October 17th. What is the latest day you can purchase the stock and still receive the dividend? Why? (1-3 sentences)
Grove Corporation issued $2,400,000 of 8% bonds on October 1, 2012, due on October 1, 2017....
Grove Corporation issued $2,400,000 of 8% bonds on October 1, 2012, due on October 1, 2017. The interest is to be paid twice a year on April 1 and October 1. The bonds were sold to yield 10% effective annual interest. Grove Corporation closes its books annually on December 31. Instructions (a)   Complete the following amortization schedule for the dates indicated. (Round all answers to the nearest dollar.) Use the effective-interest method.                                                                           Debit                       Credit            Carrying Amount                                          Credit Cash      Interest Expense      Bond Discount           ...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT