Financial Accounting: Information for Decisions Financial Accounting: Informatio
ID: 2592108 • Letter: F
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Financial Accounting: Information for Decisions Financial Accounting: Information for Decisions
Financial Accounting: Information for Decisions
John Wild 8 page 525 problem 11-4A. questions 1,2,3,4,&5. What are the answers and how did you get them.
Common stock. . . . Common stock dividend distributable . . Paid-in capital in Retained earnings.. Total equity Check $710,0 Prob Analy stock acco C3 The equity sections from Atticus Group's 2015 and 2016 year-end balance sheets follow. Stockholders' Equity (December 31,2015) Common stock $4 par value, 100,000 shares $160,000 120,000 320,000 $600,000 authorized, 40,000 shares issued and outstanding ..Explanation / Answer
1
How many common shares are outstanding on each cash dividend rate?
Date
shares outstanding
Jan-05
40000 shares
Apr-05
37000 shares
(40000 shares -3000 treasury stock)
Jul-05
37000 shares
Oct-05
44400 shares
[37000 + 7400(37000*20%)]
2
What is the dollar amount for each of the four cash dividends?
Date
working
Dividends
Jan-05
40000 shares * 0.50
20000
Apr-05
37000 shares *0.50
18500
Jul-05
37000 shares *0.50
18500
Oct-05
44400 shares * 0.50
22200
3
what is the amount of the capitalization of retained earnings for the stock dividend?
88800
(7400 shares *$12)
4
what is the per share cost of the treasury stock purchased?
30000/3000
$10 per share
5
How much net income did the company earn during year 2016?
$
Retained earnings Dec 31
400000
Add: Dividends
168000
(20000+18500+18500+22200+88800)
Retained earnings 2015
-320000
Net income
248000
1
How many common shares are outstanding on each cash dividend rate?
Date
shares outstanding
Jan-05
40000 shares
Apr-05
37000 shares
(40000 shares -3000 treasury stock)
Jul-05
37000 shares
Oct-05
44400 shares
[37000 + 7400(37000*20%)]
2
What is the dollar amount for each of the four cash dividends?
Date
working
Dividends
Jan-05
40000 shares * 0.50
20000
Apr-05
37000 shares *0.50
18500
Jul-05
37000 shares *0.50
18500
Oct-05
44400 shares * 0.50
22200
3
what is the amount of the capitalization of retained earnings for the stock dividend?
88800
(7400 shares *$12)
4
what is the per share cost of the treasury stock purchased?
30000/3000
$10 per share
5
How much net income did the company earn during year 2016?
$
Retained earnings Dec 31
400000
Add: Dividends
168000
(20000+18500+18500+22200+88800)
Retained earnings 2015
-320000
Net income
248000
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