Exercise 14-13

The following financial information is available for Wildhorse Ltd. as at December 31 (in thousands, except for per share amounts):

		2017		2016		2015
Profit		$1,919		$2,067		$2,583
Preferred share dividends (total)		$73		$43		$30
Weighted average number of common shares		487		485		486
Dividends per common share		$2.50		$2.25		$2.10
Market price per common share		$43.00		$49.75		$56.25

(a) Calculate the earnings per share, price-earnings ratio, and payout ratio for the common shareholders for each of the three years. (Round earnings per share answers to 2 decimal places, e.g. 52.75. Round price-earnings ratio answers to 1 decimal place, e.g. 52.7. Round payout ratio answers to 3 decimal places, e.g. 5.275.)

		2017			2016			2015
Earnings per share		$			$			$
Price-earnings ratio			times			times			times
Payout ratio

Problem 14-2A (Part Level Submission)

On December 31, 2016, Carla Vista Corporation had the following shareholders equity accounts:

CARLA VISTA CORPORATION Balance Sheet (partial) December 31, 2016
Shareholders equity
Common shares (unlimited number of shares authorized, 88,000 issued)		$1,036,000
Retained earnings		540,000
Total shareholders equity		$1,576,000

During the year, the following transactions occurred:

Jan.		15		Declared a $1 per share cash dividend to shareholders of record on January 31, payable February 15.
July		1		Announced a 2-for-1 stock split. The market price per share on the date of the announcement was $18.
Dec.		15		Declared a 15% stock dividend to shareholders of record on December 30, distributable on January 15. On December 15, the market price of each share was $9; on December 30, $11; and on January 15, $10.
		31		Determined that profit before income tax for the year was $411,000. The company has a 25% income tax rate.

(a) Journalize the transactions and closing entries.

Exercise 13-9 (Part Level Submission)

Kingbird Inc. has recorded all necessary adjusting entries, except for income tax expense, at its fiscal year end, July 31, 2017. The following information has been taken from the adjusted trial balance:

Accounts payable		$25,000		Interest expense		$5,700
Cash dividendscommon		56,000		Notes payable		108,000
Common shares		204,000		Retained earnings (Aug. 1, 2016)		310,500
Cost of goods sold		310,000		Salaries expense		138,000
Dividends payable		15,500		Sales		678,000
Income tax expense		26,200		Supplies expense		11,000
Income tax payable		2,700		Unearned revenue		11,200

All accounts have normal balances and total assets equal $808,000. Kingbird has a 20% income tax rate.

Prepare a statement of retained earnings