Question 6

On 4/15 Blue Corp. declares a $4.85 cash dividend. On that date, the company had 45,000 shares issued, 40,000 of which were outstanding (5,000 were held in treasury). Blue Corp. paid the dividend to its shareholders on 4/20.

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What is the impact of paying the cash dividend on Blue Corp.'s Net Income?

Question 6 options:

Blue Corp.'s net income will be increased by $194,000.

Blue Corp.'s net income will be reduced by $218,250.

Blue Corp.'s net income will be reduced by $194,000.

Blue Corp.'s net income will be increased by $218,250.

Paying a cash dividend does not impact net income.

Question 7

Green Corp. declares a 25% stock dividend to its shareholders on 2/10. On that date, the company had 800,000 shares issued, 700,000 of which were outstanding (100,000 were held in treasury). Green Corp. common stock has a par value of $1 and a fair market value of $88 Green Corp. distributed the stock the dividend to its shareholders on 2/28. On 3/15 Green Corp. declares a 3 for 1 stock split.

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What journal entry will Green Corp. record on 2/10, when the stock dividend is declared?

Question 7 options:

Dr. Stock Dividends $17,600,000

Cr. Stock Dividend Distributable $200,000

Cr. APIC $17,400,000

Dr. Stock Dividends $15,400,000

Cr. Common Stock $175,000

Cr. APIC $15,225,000

Dr. Stock Dividends $61,600,000

Cr. Stock Dividend Distributable $700,000

Cr. APIC $60,900,000

Dr. Stock Dividends $15,400,000

Cr. Stock Dividend Distributable $175,000

Cr. APIC $15,225,000

Question 8

Green Corp. declares a 25% stock dividend to its shareholders on 2/10. On that date, the company had 800,000 shares issued, 700,000 of which were outstanding (100,000 were held in treasury). Green Corp. common stock has a par value of $1 and a fair market value of $88 Green Corp. distributed the stock the dividend to its shareholders on 2/28. On 3/15 Green Corp. declares a 3 for 1 stock split.

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What is the impact of declaring the stock dividend on Green Corp.'s Net Income?

Question 8 options:

Green Corp.'s net income will be reduced by $700,000.

Green Corp.'s net income will be increased by $15,400,000.

Green Corp.'s net income will be increased by $700,000.

Green Corp.'s net income will be reduced by $15,400,000.

Declaring a stock dividend does not impact net income.

Question 9

Green Corp. declares a 25% stock dividend to its shareholders on 2/10. On that date, the company had 800,000 shares issued, 700,000 of which were outstanding (100,000 were held in treasury). Green Corp. common stock has a par value of $1 and a fair market value of $88 Green Corp. distributed the stock the dividend to its shareholders on 2/28. On 3/15 Green Corp. declares a 3 for 1 stock split.

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What journal entry will Green Corp. record on 2/28, when the stock dividend is distributed?

Question 9 options:

Dr. Stock Dividend Distributable $700,000

Cr. Common Stock $700,000

Dr. Stock Dividend Distributable $175,000

Cr. Cash $175,000

Dr. Stock Dividend Distributable $175,000

Cr. Common Stock $175,000

Dr. Stock Dividend Distributable $800,000

Cr. Common Stock $800,000

Question 10

Green Corp. declares a 25% stock dividend to its shareholders on 2/10. On that date, the company had 800,000 shares issued, 700,000 of which were outstanding (100,000 were held in treasury). Green Corp. common stock has a par value of $1 and a fair market value of $88 Green Corp. distributed the stock the dividend to its shareholders on 2/28. On 3/15 Green Corp. declares a 3 for 1 stock split.

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What is the impact ofdistributingthe stock dividend on Green Corp.'s Net Income?

Question 10 options:

Green Corp.'s net income will be reduced by $700,000.

Green Corp.'s net income will be increased by $700,000.

Green Corp.'s net income will be increased by $15,400,000.

Green Corp.'s net income will be reduced by $15,400,000.

Distributing a stock dividend does not impact net income.