please answer all! thank you! Which of the following is/are true? A. Preferred s
ID: 2525483 • Letter: P
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please answer all! thank you!
Which of the following is/are true? A. Preferred stock is usually voting stock. B. Common stock is usually voting stock. C. Common dividends are usually paid first, before preferred dividends. D. Both B and C are true. B&B; Corporation is authorized to sell 60,000 shares of $10 par, 6% cumulative preferred stock and 90,000 shares of S6 par common stock. There are 30,000 shares of preferred stock outstanding and 30,000 shares of common stock outstanding. A $40,000 cash dividend has been declared by the board of directors. No dividends in arrears exist. What is the total amount to be given to the preferred shareholders? A. $40,000 B. $20,000 C. $36,000 D. $18,000 Refer to Question 3. What is the common stock dividend per share amount (rounded)? A. $.733 B. $.367 C. $.244 D. $1.333 Ursula Corporation issued 50,000 shares of S1 par common stock at a price of $10 per share. On June 1, Ursula purchased 2,000 shares of its own stock at a cost of S14 per share. On December 1, Ursula resold all the shares for $16 each. The entry on December 1 would include which of these? A. Credit to Paid-in Capital from Treasury Stock Transactions, $4,000. B. Credit to Treasury Stock, $32,000. C. Credit to Gain on the Sale of Treasury Stock, $4,000. D. Debit to Cash, $28,000.Explanation / Answer
2. B. Common stock is usually voting stock.
3. D. Total amount be given to preferred shareholders is $18,000 (30,000 shares ×$10×6%).
4. Dividend to common shareholders = Total dividends - Dividend to preferred shareholders
= $40,000 - $18,000
=$22,000
Common stock dividend per share amount = Dividend to common shareholders / Common shares outstanding
=$22,000 / 30,000 shares
=$0.733 per share
A. Common stock dividend per share amount is $0.733 per share
5. Entry on December 1:
Debit to cash,(2,000×$16) $32,000
Credit to treasury stock,(2,000×$14) $28,000
Credit to paid in capital from treasury stock,(2,000×$2) $4,000
Correct answer is A. Credit to paid in capital from treasury stock, $4,000.
6.
B. 105 shares ((1,000 shares -300 shares) × 15%).
7. Entry on March 30, 2016:
Debit to cash,(30,000×$11) $330,000
Credit to common stock,(30,000×$1) $30,000
Credit to paid in capital in excess of par-common stock,(30,000×$10) $300,000
Correct answer is C. Credit to common stock, $30,000.
8. C. On the date of declaration.
9. A. The maximum number of shares the company can issue.
10. B. Preferred stock
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