Question
Homestead Oil Corp. was incorporated on January 1, 2016, and issued the following stock for cash: 840,000 shares of no-par common stock were authorized; 150,000
Homestead Oil Corp. was incorporated on January 1, 2016, and issued the following stock for cash:
840,000 shares of no-par common stock were authorized; 150,000 shares were issued on January 1, 2016, at $19.00 per share.
280,000 shares of $90 par value, 9.00% cumulative, preferred stock were authorized, and 61,000 shares were issued on January 1, 2016, at $140 per share.
Net income for the years ended December 31, 2016 and 2017, was $1,410,000 and $2,550,000, respectively.
No dividends were declared or paid during 2016. However, on December 28, 2017, the board of directors of Homestead declared dividends of $1,430,000, payable on February 12, 2018, to holders of record as of January 19, 2018.
QUESTION
1 Use the horizontal model for the declaration of dividends on December 28, 2017. (Use amounts with + for increases and amounts with for decreases.)
2 Use the horizontal model for the payment of dividends on February 12, 2018. (Use amounts with + for increases and amounts with for decreases.)
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