PART 1

Love Theatre Inc. owns and operates movie theaters throughout New Mexico and Utah. Love Theatre has declared the following annual dividends over a six-year period: 2011, $40,000; 2012, $120,000; 2013, $180,000; 2014, $220,000; 2015, $280,000; and 2016, $350,000. During the entire period ending December 31 of each year, the outstanding stock of the company was composed of 25,000 shares of cumulative, 4% preferred stock, $100 par, and 100,000 shares of common stock, $15 par.

1. Calculate the average annual dividend per share for common stock for the six-year period. If required, round your answers to two decimal places.

2. Assuming a market price per share of $267 for the preferred stock and $19 for the common stock, calculate the average annual percentage return on initial shareholders' investment, based on the average annual dividend per share for preferred stock and for common stock. Round your answers to two decimal places. (Answer as a percentage)

PART 2

On December 1 of the current year, the following accounts and their balances appear in the ledger of Latte Corp., a coffee processor:

Preferred 2% Stock, $50 par (260,000 shares authorized, 76,000 shares issued)	$3,800,000
Paid-In Capital in Excess of ParPreferred Stock	456,000
Common Stock, $30 par (1,000,000 shares authorized, 419,000 shares issued)	12,570,000
Paid-In Capital in Excess of ParCommon Stock	1,676,000
Retained Earnings	159,380,000

At the annual stockholders meeting on March 31, the board of directors presented a plan for modernizing and expanding plant operations at a cost of approximately $11,000,000. The plan provided (a) that a building, valued at $3,335,000, and the land on which it is located, valued at $898,000, be acquired in accordance with preliminary negotiations by the issuance of 124,500 shares of common stock, (b) that 39,800 shares of the unissued preferred stock be issued through an underwriter, and (c) that the corporation borrow $4,100,000. The plan was approved by the stockholders and accomplished by the following transaction: (JUST NEED THE LAST TWO NUMBERS)

May 11

Issued 124,500 shares of common stock in exchange for land and a building, according to the plan.

May 11

Debit: Building........3,335,000

Debit: Land.............898,000

Credit: Common Stock................................................................. ???

Credit: Paid-In Capital In excess of Par-common Stock............... ???