Question
Moose Valley Makeup Company has a December 31 year-end and has been in operation for 10 years.On January 1, 2019, the equity section of the
Moose Valley Makeup Company has a December 31 year-end and has been in operation for 10 years.On January 1, 2019, the equity section of the company is:
Contributed capital:
Common Shares, unlimited shares authorized
8,000 shares, issued and outstanding$ 240,000.00
Retained earnings78,000.00
Total Equity$ 318,000.00
Step 1:
Moose Valley decides to repurchase and retire 1000 shares on May 1 and purchases the shares for $25 that day.Prepare the appropriate journal entry to record this transaction.
Step 2:
On October 10, the Board of Directors decides to declare a 10% share dividend to shareholders of record on October 20, to be paid on October 31.The market price for the shares is $12.00 on October 10, 13.50 on October 20 and $12.50 on October 31.Prepare required journal entries for these transactions.
Step 3:
The Net income after taxes of the company for 2019 is $46,000.Recognizing this and the stock dividend, prepare the Equity section of Moose Valley Makeup Company on December 31, 2019.
Step 4:
Calculate the earnings per share.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started