The Retained earnings account for Nathan Corporation had a credit balance of $800,000 at the end of
Question:
The Retained earnings account for Nathan Corporation had a credit balance of $800,000 at the end of 20X0. Selected transactions during 20X1 follow:
a. Net income was $130,000.
b. Cash dividends declared were $60,000.
c. Repurchased 100 shares of Nathan Corporation common stock, paying $20 per share. Each share has a $5 par value and was originally issued for $35.
d. Sold 20 shares of Nathan Corporation common stock for $22 each.
Required:
Calculate Nathan’s retained earnings balance as of the end of 20X1. What is the maximum dividend Nathan could have declared in 20X1? Assume there are no legal or contractual restrictions that apply.
Step by Step Answer:
The legality of corporate dividend distributions varies from state to st...View the full answer
Financial Reporting And Analysis
ISBN: 9781260247848
8th Edition
Authors: Lawrence Revsine, Daniel Collins, Bruce Johnson, Fred Mittelstaedt, Leonard Soffer
