Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

1.Analyze the following transactions and indicate the effect on each of the following: total assets , total paid-in capital , total retained earnings , and

1.Analyze the following transactions and indicate the effect on each of the following:total assets, total paid-in capital, total retained earnings, and total stockholders' equity. (Make sure to state the effect in terms of increase or decrease with dollar amount, if there is no effect, please state that).

STOCKHOLDERS' EQUITY

PAID-IN CAPITAL

Preferred Stock - $50 par value; 6%, cumulative 2000 shares authorized, 1000 shares

Issued and outstanding$50,000

Paid in capital in Excess of Par - Preferred5,000

Common Stock- $1 par value; 10,000,000 shares authorized, 2,000,000

shares issued and outstanding2,000,000

Paid in capital in Excess of Par - Common19,000,000

Total Paid-in Capital$21,055,000

Retained Earnings9,000,000

Total Stockholders' Equity$30,055,000

Transaction: (each transaction is independent)

a.The corporation declares and issues a 5% stock dividend on the common stock when the fair value of the stock is $12 per share.

b.The corporation declares and pays a regular cash dividend on the preferred stock.

c.The board of directors for the corporation announce a 2 for 1 stock split and issues new shares.

d.The corporation declares and issues a 30% stock dividend on the common stock when

the market price of the stock is $16 per share.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Cornerstones of Financial and Managerial Accounting

Authors: Rich, Jeff Jones, Dan Heitger, Maryanne Mowen, Don Hansen

2nd edition

978-0538473484, 538473487, 978-1111879044

More Books

Students also viewed these Accounting questions

Question

Why is an adverse opinion issued for ICFR?

Answered: 1 week ago

Question

5. How can I help others in the network achieve their goals?

Answered: 1 week ago