Question
2. The stockholders' equity of TVX Company at the beginning of the day on February 5 follows: Common stock -- $10 par value, 150,000 shares
2. The stockholders' equity of TVX Company at the beginning of the day on February 5 follows:
Common stock -- $10 par value, 150,000 shares authorized, 67,000 shares issues and outstanding | 670,000 |
Paid-in capital in excess of par value, common stock | 525,000 |
Retained Earnings | 675,000 |
Total Stockholders' Equity | 1,870,000 |
On February 5, the directors declare a 12% stock dividend distributable on February 28 to the February 15 stockholders of record. The stock's market value is $39 per share on February 5 before the stock dividend. The stock's market value is $35.00 per share on February 28.
1. Prepare entries to record the dividend declaration and its distribution.
2. One stockholder owned 800 shares on February 5 before the dividend. Compute the book value per share and total book value of this stockholder's shares immediately before and after the stock dividend of February 5.
3. Compute the total market value of the investor's shares in part 2 as of February 5 and February 28.
Feb 5 | Retained Earnings |
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| Common stock dividend distributable |
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| Paid in capital in excess of par value, common stock |
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| Declared 12% stock dividend |
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Feb 28 | Common stock dividend distributable |
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| Common stock |
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| Distributed common stock dividend declared on Feb 5 |
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2.) One stockholder owned 550 shares on February 5 before the dividend. Compute the book value per share and total book value of this stockholders shares immediately before and after the stock dividend of February 5. (Round your "Book value per share" answers to 3 decimal places.)
3.) Compute the total market value of the investors shares in part 2 as of February 5 and February 28.
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Required: | |
1. | Prepare journal entries to record each of these transactions for 2017. |
Date | Account Title | Debit | Credit |
Jan. 2 | Treasury stock, common |
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| Cash |
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Jan. 7 | Retained earnings
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| Common dividend payable |
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Feb. 28 | Common dividend payable |
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| Cash |
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Jul. 9 | Cash |
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| Treasury stock, common |
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| Paid-in capital, treasury stock |
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Aug. 27 | Cash |
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| Paid in capital, treasury stock |
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| Retained earnings |
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| Treasury stock, common |
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Date | Account Title | Debit | Credit |
Sep. 9 | Retained earnings |
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| Common dividend payable |
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Oct. 22 | Common dividend payable |
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| Cash |
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Dec. 31 | Income summary |
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| Retained earnings |
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Prepare a statement of retained earnings for the year ended December 31, 2017
Alexander Corporation Statement of Retained Earnings For Year Ended December 31, 2017 | |
Retained earnings, December 31, 2015 |
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Add: Net income | Dec. 31 |
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Less: Cash dividends declared | Jan. 7 + Sep. 9 |
Less: Treasury stock reissuances | Aug. 27 |
Retained earnings, December 31, 2016 |
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Prepare the stockholders equity section of the companys balance sheet as of December 31, 2016
Alexander Corporation Statement of Retained Earnings For Year Ended December 31, 2017 | |
Common stock authorized, |
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Paid-in capital in excess of par value, common stock |
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Retained earnings |
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Less: Treasury stock |
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Total stockholders equity |
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