In: Accounting
The stockholders’ equity accounts of Bramble Corp. on January 1,
2017, were as follows.
Preferred Stock (7%, $100 par noncumulative, 14,000 shares authorized) | $840,000 | |
Common Stock ($4 stated value, 840,000 shares authorized) | 2,800,000 | |
Paid-in Capital in Excess of Par Value—Preferred Stock | 42,000 | |
Paid-in Capital in Excess of Stated Value—Common Stock | 1,344,000 | |
Retained Earnings | 1,926,400 | |
Treasury Stock (14,000 common shares) | 112,000 |
During 2017, the corporation had the following transactions and
events pertaining to its stockholders’ equity.
Feb. | 1 | Issued 14,000 shares of common stock for $84,000. | |||||||||||||
Mar. | 20 | Purchased 2,800 additional shares of common treasury stock at $7 per share. | |||||||||||||
Oct. | 1 | Declared a 7% cash dividend on preferred stock, payable November 1. | |||||||||||||
Nov. | 1 | Paid the dividend declared on October 1. | |||||||||||||
Dec. | 1 | Declared a $0.50 per share cash dividend to common stockholders of record on December 15, payable December 31, 2017. | |||||||||||||
Dec. | 31 |
Determined that net income for the year was $785,000. Paid the dividend declared on December 1. Calculate the payout ratio, earnings per share, and return on
common stockholders’ equity. (Round earning per share
to 2 decimal places, e.g. $2.66 and all other answers to 1 decimal
place. 17.5%.)
|