Question
Listed below are the transactions that affected the shareholders equity of Branch-Rickie Corporation during the period 20162018. At December 31, 2015, the corporations accounts included:
Listed below are the transactions that affected the shareholders equity of Branch-Rickie Corporation during the period 20162018. At December 31, 2015, the corporations accounts included: |
($ in 000s) | |||
Common stock, 119 million shares at $1 par | $ | 119,000 | |
Paid-in capitalexcess of par | 714,000 | ||
Retained earnings | 980,000 | ||
a. | November 1, 2016, the board of directors declared a cash dividend of $0.70 per share on its common shares, payable to shareholders of record November 15, to be paid December 1. |
b. | On March 1, 2017, the board of directors declared a property dividend consisting of corporate bonds of Warner Corporation that Branch-Rickie was holding as an investment. The bonds had a fair value of $3.5 million, but were purchased two years previously for $3.1 million. Because they were intended to be held to maturity, the bonds had not been previously written up. The property dividend was payable to shareholders of record March 13, to be distributed April 5. |
c. | On July 12, 2017, the corporation declared and distributed a 4% common stock dividend (when the market value of the common stock was $18 per share). Cash was paid in lieu of fractional shares representing 760,000 equivalent whole shares. |
d. | On November 1, 2017, the board of directors declared a cash dividend of $0.70 per share on its common shares, payable to shareholders of record November 15, to be paid December 1. |
e. | On January 15, 2018, the board of directors declared and distributed a 3-for-2 stock split effected in the form of a 50% stock dividend when the market value of the common stock was $19 per share. |
f. | On November 1, 2018, the board of directors declared a cash dividend of $0.55 per share on its common shares, payable to shareholders of record November 15, to be paid December 1. |
Required: |
1. | Prepare the journal entries that Branch-Rickie recorded during the three-year period for these transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in whole dollars.) |
2. | Prepare comparative statements of shareholders equity for Branch-Rickie for the three-year period. Net income was $425 million, $490 million, and $550 million for 2016, 2017, and 2018, respectively.(Negative amounts should be indicated by a minus sign. Enter your answers in thousands (000's).) |
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