1) Match each item/event pair below with the indicated change in the item. An individual classification may be used more than once, or not at all. For each dividend, assume that both declaration and payment or distribution has occurred. Classifications A. Item increases B. Item decreases C. Item is unchanged D. Direction of change cannot be determined [10] Item 1. Book value per share Event Stock dividend 2. Legal capital per common share Cash dividend 3. Total retained earnings Stock split Prior period adjustment increases last year's net income 4. Total shareholders' equity 5. Earnings per common share Restriction of retained earnings 6. Total retained earnings Change in accounting principle Stock dividend 7. Number of common shares issued Cash dividend 8. Total retained earnings Stock dividend 9. Total contributed capital Stock dividend 10. Legal capital per common share

1) Match each item/event pair below with the indicated change in the item. An individual classification may be used more than once, or not at all. For each dividend, assume that both declaration and payment or distribution has occurred. Classifications A. Item increases B. Item decreases C. Item is unchanged D. Direction of change cannot be determined [10] Item 1. Book value per share Event Stock dividend 2. Legal capital per common share Cash dividend 3. Total retained earnings Stock split Prior period adjustment increases last year's net income 4. Total shareholders' equity 5. Earnings per common share Restriction of retained earnings 6. Total retained earnings Change in accounting principle Stock dividend 7. Number of common shares issued Cash dividend 8. Total retained earnings Stock dividend 9. Total contributed capital Stock dividend 10. Legal capital per common share

Financial Accounting

15th Edition

ISBN:9781337272124

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter13: Corporations: Organization, Stock Transactions, And Dividends

Section: Chapter Questions

Problem 12E

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Which of the following correctly reflects the effect of dividend? a. On the date of payment of property dividend: ASSETS - Decrease, LIABILITIES - Decrease, EQUITY - Decrease b. On the date of declaration of small share dividend: ASSETS - No effect, LIABILITIES - No effect, EQUITY - Decrease c. On the date of declaration of dividend: ASSETS - No effect, LIABILITIES - Decrease, EQUITY - Decrease d. On the date of distribution of large share dividend: ASSETS - No effect, LIABILITIES - No effect, EQUITY - No effect
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Which of the following correctly reflects the effect of dividend? a. On the date of distribution of large share dividend: ASSETS - No effect, LIABILITIES - No effect, EQUITY - No effect b. On the date of payment of property dividend: ASSETS - Decrease, LIABILITIES - Decrease, EQUITY - Decrease c. On the date of declaration of small share dividend: ASSETS - No effect, LIABILITIES - No effect, EQUITY - Decrease d. On the date of declaration of dividend: ASSETS - No effect, LIABILITIES - Decrease, EQUITY - Decrease Which of the following illustrates the effect of 15% share dividend declared and issued when the market price is higher than the par value? * a. RETAINED EARNINGS - Increase, SHARE PREMIUM - Decrease, TOTAL EQUITY - Increase b.RETAINED EARNINGS - Increase, SHARE PREMIUM - Increase, TOTAL EQUITY - Increase c. RETAINED EARNINGS - Decrease, SHARE PREMIUM - Increase, TOTAL EQUITY - No…
Which of the following correctly reflects the effect of dividend? On the date of distribution of large share dividend: ASSETS - No effect, LIABILITIES - No effect, EQUITY - No effect On the date of declaration of dividend: ASSETS - No effect, LIABILITIES - Decrease, EQUITY - Decrease On the date of payment of property dividend: ASSETS - Decrease, LIABILITIES - Decrease, EQUITY - Decrease On the date of declaration of small share dividend: ASSETS - No effect, LIABILITIES - No effect, EQUITY - Decrease
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