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Chapter 13: 9RQ (page 707)
If stock is issued for assets other than cash describe the recording of this transaction
The stocks issued for assets other than cash are recorded at the market value of the assets exchanged or the market value of the corporate stock.
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Computing dividends on preferred and common stock and journalizing
Northern Communications has the following stockholders鈥� equity on December 31,
2018:
Preferred Stock鈥�5%, \(11 Par Value; 150,000 shares authorized, 20,000 shares issued and outstanding
Paid-In Capital:
\) 220,000
760,000
Stockholders鈥� Equity
Paid-In Capital in Excess of Par鈥擟ommon 680,000
Total Paid-In Capital 1,660,000
Retained Earnings 200,000
Total Stockholders鈥� Equity \( 1,860,000
Common Stock鈥擻)2 Par Value; 575,000 shares
authorized, 380,000 shares issued and outstanding
Requirements
2. Record the journal entries for 2018, assuming that Northern Communications declared the dividend on December 1 for stockholders of record on December 10. Northern Communications paid the dividend on December 20.
What is a prior-period adjustment?
Question: Copperhead Trust has the following classes of stock:
Preferred Stock鈥�6%, \(12 par value; 8,500 shares authorized, 7,000 shares issued and outstanding
Common Stock鈥擻)0.10 par value; 2,100,000 shares authorized, 1,400,000 shares issued and outstanding
Requirements
2. Assume the preferred stock is cumulative and Copperhead passed the preferred dividend in 2016 and 2017. In 2018, the company declares cash dividends of $46,000. How much of the dividend goes to preferred stockholders? How much goes to common stockholders?
Question: Accounting for cash dividends
Java Company earned net income of \(85,000 during the year ended December 31, 2018. On December 15, Java declared the annual cash dividend on its 4% preferred stock (par value, \)120,000) and a $0.25 per share cash dividend on its common stock (50,000 shares). Java then paid the dividends on January 4, 2019.
Requirements
1. Journalize for Java the entry declaring the cash dividends on December 15, 2018.
Preparing a statement of retained earnings
Kingston, Inc. had beginning retained earnings of \(135,000 on January 1, 2018. During the year, Kingston declared and paid \)85,000 of cash dividends and earned $75,000 of net income. Prepare a statement of retained earnings for Kingston, Inc. for the year ending December 31, 2018.
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