Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Identifying and Analyzing Financial Statement Effects of Dividends The stockholders' equity of Kinney Company at December 31, 2011, is shown below. 5% preferred stock, $100

Identifying and Analyzing Financial Statement Effects of Dividends The stockholders' equity of Kinney Company at December 31, 2011, is shown below.

5% preferred stock, $100 par value, 12,000 shares authorized; 5,000 shares issued and outstanding $ 500,000
Common stock, $5 par value, 400,000 shares authorized; 100,000 shares issued and outstanding 500,000
Paid-in capital in excess of par valuepreferred stock 40,000
Paid-in capital in excess of par valuecommon stock 600,000
Retained earnings 656,000
Total stockholders' equity $2,296,000

The following transactions, among others, occurred during 2012: Apr. 1 Declared and issued a 100% stock dividend on all outstanding shares of common stock. The market value of the stock was $11 per share. Dec. 7 Declared and issued a 3% stock dividend on all outstanding shares of common stock. The market value of the stock was $14 per share. Dec. 20 Declared and paid (1) the annual cash dividend on the preferred stock and (2) a cash dividend of 80 cents per common share. (a) Use the financial statement effects template to indicate the effects of these separate transactions.

Use negative signs with your answers, when appropriate.

Balance Sheet

Transaction Cash Asset + Noncash Assets = Liabilities +

Contributed

Capital

+

Earned

Capital

Apr. 1 Answer

Answer

Answer

Answer

Answer

Dec. 7 Answer

Answer

Answer

Answer

Answer

Dec. 20 Answer

Answer

Answer

Answer

Answer

Income Statement

Revenue - Expenses =

Net

Income

Answer

Answer

Answer

Answer

Answer

Answer

Answer

Answer

Answer

(b) Compute retained earnings for 2012 assuming that the company reports 2012 net income of $253,000. $Answer

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

Excel For Auditors

Authors: Bill Jelen, Dwayne K. Dowell

1st Edition

1932802169, 978-1932802160

More Books

Students also viewed these Accounting questions

Question

4-6 Is there a digital divide? If so, why does it matter?

Answered: 1 week ago