ABC Company had 600,000 ordinary shares outstanding on January 1, 2020. During 2020, ABC issued rights to acquire one ordinary share at P10 in the ratio of one new share for every 4 shares outstanding. The market value of the ordinary share immediately prior to the rights issue is P35. The rights were exercised on October 1, 2020. The net income of ABC Company for the year is P8,550,000. ABC shall report basic earnings per share in its income statement at (round answer to a whole number)
Q: Sage Company is operating at 90% of capacity and is currently purchasing a part used in its…
A: Make or buy is the decision making analysis that helps the entity to decide if a product should be…
Q: On January 1, 2021, LLB Industries borrowed $200.000 from Trust Bank by issuing a two-year, 10%…
A: Journal entries can be defined as the process of recording a transaction in the records of the…
Q: Determine the allocation of the distributions by completing the table below. Assu
A: SOLUTION:-Particularsin $Accumulated E&P$98,000Current E&P$294,000Total$392,000ABC -Current…
Q: [The following information applies to the questions displayed below.] The Field, Brown & Snow are…
A: A partnership is one type of business where two or more persons jointly own for the purpose of…
Q: Diamond Computer Company has been purchasing carrying cases for its portable computers at a purchase…
A: Variable factory overhead per unit when carrying cases are manufactured = Direct labor cost per unit…
Q: Explain the concept of fair value accounting and its application in financial reporting. Discuss the…
A: Fair value accounting is an accounting approach that values assets, liabilities, or other financial…
Q: The International Accounting Standards Board O promotes unique accounting applications. O only…
A: Statement: The International Accounting Standards Board (IASB) works to reduce differences in…
Q: The Production Department of Hruska Corporation has submitted the following forecast of units to be…
A: The budget is prepared to estimate the cost for the current period. The manufacturing costs can be…
Q: Prepare the journal entries to record the assignment of (1) direct materials, (2) direct labor, and…
A: Overhead rate = total overhead cost / base activityOverhead will be applied to activities using this…
Q: Find the EPS, P/E ratio, and dividend yield of a company that has six million shares of common stock…
A: As per our policy,in case of multiple questions,we are allowed to answer the first one.Hence…
Q: a. Compute the gross margin for Mason Company using the following cost flow assumptions: (1) FIFO,…
A: calculation of gross margin particulars FIFO LIFO weighted average A] sales (370 units ×…
Q: e financing si
A: The financing side of the accounting equationsh shows how a company has obtained the funds to…
Q: Q.1 The Brotherhood Company has produced the following information from which a cash budget for the…
A: Given that,Selling price per unit = K50000Variable cost per unit :Material = K26000Labor =…
Q: On April 1, Sangvikar Company had the following balances in its inventory accounts: Materials…
A: To record transactions and event journal entries are required to be passed. Journal entries are the…
Q: Shady Fabrication Group (SFG) manufactures components for manufacturing equipment at several…
A: ABC costing, also known as Activity-Based Costing, is a method of cost allocation that assigns costs…
Q: Concord has the following inventory information. July 1 Beginning Inventory 30 units at $15 7 90…
A: INVENTORY VALUATIONInventory Valuation is a Method of Calculation of Value of Inventory at the End…
Q: Silven Industries, which manufactures and sells a highly successful line of summer lotions and…
A: Variable manufacturing overhead per unit = Total manufacturing overhead per unit - Fixed…
Q: What business expense amount can Ryan deduct (if any) for these trips?
A: computation of maximum deductiontotal miles travelled$13,600miles for which documentation is…
Q: At December 31, 2019 and 2020, ABC Company had outstanding 40,000 shares of P100 par value 6%…
A: The dividend is declared to the shareholders from the retained earnings of the business. The…
Q: When is accumulated depreciation reduced to zero? Explain and provide examples for each element…
A: Accumulated depreciation is a contra-asset account that represents the cumulative depreciation…
Q: BB, WW and FF agree to sell construction tools for a period of one month. BB agrees to construct a…
A: Given:The data is given as, BB- 170000 WW-260000 FF-60000
Q: On 1 January 20X7, Change Incorporated commenced business operations. At 31 December 20X9, the…
A: A journal entry is the act of recording any transaction, whether one that is economic or not. An…
Q: ow does the Heal
A: The (HIPAA) plays a crucial role in facilitating electronic transactions within the healthcare…
Q: Berry's Boxes manufactures boxes. It expects to sell 20,000 bo of direct materials to produce 24,000…
A: To calculate Berry's Boxes production costs for direct materials, direct manufacturing labor, and…
Q: [The following information applies to the questions displayed below.] Tall Pines Brewery (TPB) makes…
A: Market Share Variance= Actual Market Size in Units x (Actual Market Share- Budgeted Market Share) x…
Q: how about these 3 requirments Prepare a direct materials budget for the first quarter of the…
A: Prior to beginning an operation, a budget is used to estimate revenue and expenses. Setting a…
Q: Proceeds from Notes Payable On January 26, Vibrant Co. borrowed cash from Conrad Bank by issuing a…
A: The cost of borrowing money over a given time period is expressed as interest, which is often stated…
Q: During its first year of operations, Skysong Corporation had the following transactions pertaining…
A: Issuance of Common Stock -When the company issues shares to the ordinary shareholders, the amounts…
Q: Sunland Company purchases a patent for $146.800 cash on January 2, 2024. Its legal life is 20 years…
A: JOURNAL ENTRIESJournal Entry is the First stage of Accounting Process. Journal Entry is the Process…
Q: Required: a Assign overhead costs to activity cost pools using activity-based costing b. Calculate…
A: Variable costs means the costs that varies with the change in the level of output whereas fixed…
Q: Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin…
A: Variable expense per unit remains same and varies in total with the units of production. Fixed cost…
Q: which line number on 1040 and schedule B tax forms are the following numbers entered Gary and Gladys…
A: The gross income does not include the interest on obligation of a state or any political subdivision…
Q: FROM THE FOLLOWING, CALCULATE PROFITABILITY RATIOS. TRADING AND PROFIT AND LOSS ACCOUNT OF MMR & CO.…
A: Gross profit margin = (gross profit/ sales) * 100 = (680,000 /…
Q: Larkspur Corporation had income from continuing operations of $455,000 for the year ended December…
A: Income statement is the one which is prepared by the entity for the purpose of reporting the net…
Q: Company D had the following accounts receivable information: Beginning accounts receivable:…
A: Bad debt expense refers to the estimated amount of accounts receivable that a company expects will…
Q: Hoover Corp., a wholesaler of music equipment, issued $20,000,000 of 20-year, 6% callable bonds on…
A: Bonds offer diversification benefits within an investment portfolio. They tend to have a lower…
Q: What is the meaning behind cost of acquisition? Please explain and provide an example.
A: By tracking the cost of acquisition, businesses can assess the profitability of their marketing…
Q: Merrill Company makes a household appliance with model number X800. The goal for 2020 is to reduce…
A: Revenue is defined as any monetary payment received from a customer when an entity carries out its…
Q: Discount Amortization On the first day of the fiscal year, a company issues a $5,500,000, 12%,…
A: Bonds are generally considered less risky than stocks or other equity investments. Bonds represent a…
Q: Required information [The following information applies to the questions displayed below.] Evergreen…
A: An asset loses value over time as a result of use, damage, or obsolescence. Depreciation is the…
Q: For each item, determine the accounts to be adjusted on December 31, 2024, the amount of the…
A: Unearned Revenue -Unearned Revenue is the amount received by the organization from the customer. The…
Q: The accounting records of Pharoah Manufacturing Company include the following information: Work in…
A: Total manufacturing cost :— It is the sum of direct material used, direct…
Q: Problem 3-24A (Algo) Preparing a schedule of cost of goods sold and multistep and single-step income…
A: The financial statement that examines the financial performance of a corporate entity over a…
Q: Profitability Ratios The following selected data were taken from the financial statements of…
A: Return on total assets :— It is calculated by dividing income before interest by average total…
Q: Turbo Shop uses job order costing to determine the cost of performing engine repair work. Estimated…
A: The pre-determined overhead rate is calculated as estimated overhead costs divided by estimated base…
Q: January 1 January 5 Sheridan Inc. is a retailer operating in British Columbia. Sheridan uses the…
A: Inventory Valuation Methods are methods of valuation of inventory.There are three methods of…
Q: Minden Co. has sales of $500,000, operating profit of $50,000, interest expense of $10,000, tax…
A: Debt to equity ratio, is a financial metric that compares a company's total debt to its total…
Q: Calculate the amount of taxable income for 2020. Taxable income, 2020 $. Enter your answer in…
A: There are temporary differences which causes the differences of the incomes as per two separate…
Q: The accounting records of Wall's China Shop reflected the following balances as of January 1, Year…
A: The income statement, balance sheet, and statement of stockholders' equity are the important…
Q: n January 1, 2020, Ehrlich Corporation issued 7%, 15-year bonds with a face amount of $900,000 at…
A: The bonds are the financial instruments that are issued to raise money from the market or investors.…
ABC Company had 600,000 ordinary shares outstanding on January 1, 2020. During 2020, ABC issued rights to acquire one ordinary share at P10 in the ratio of one new share for every 4 shares outstanding.
The market value of the ordinary share immediately prior to the rights issue is P35. The rights were exercised on October 1, 2020. The net income of ABC Company for the year is P8,550,000.
ABC shall report basic earnings per share in its income statement at (round answer to a whole number)
Step by step
Solved in 6 steps
- On January 1, 2019, Kittson Company had a retained earnings balance of 218,600. It is subject to a 30% corporate income tax rate. During 2019, Kittson earned net income of 67,000, and the following events occurred: 1. Cash dividends of 3 per share on 4,000 shares of common stock were declared and paid. 2. A small stock dividend was declared and issued. The dividend consisted of 600 shares of 10 par common stock. On the date of declaration, the market price of the companys common stock was 36 per share. 3. The company recalled and retired 500 shares of 100 par preferred stock. The call price was 125 per share; the stock had originally been issued for 110 per share. 4. The company discovered that it had erroneously recorded depreciation expense of 45,000 in 2018 for both financial reporting and income tax reporting. The correct depreciation for 2018 should have been 20,000. This is considered a material error. Required: 1. Prepare journal entries to record Items 1 through 4. 2. Prepare Kittsons statement of retained earnings for the year ended December 31, 2019.Monona Company reported net income of 29,975 for 2019. During all of 2019, Monona had 1,000 shares of 10%, 100 par, nonconvertible preferred stock outstanding, on which the years dividends had been paid. At the beginning of 2019, the company had 7,000 shares of common stock outstanding. On April 2, 2019, the company issued another 2,000 shares of common stock so that 9,000 common shares were outstanding at the end of 2019. Common dividends of 17,000 had been paid during 2019. At the end of 2019, the market price per share of common stock was 17.50. Required: 1. Compute Mononas basic earnings per share for 2019. 2. Compute the price/earnings ratio for 2019.Anoka Company reported the following selected items in the shareholders equity section of its balance sheet on December 31, 2019, and 2020: In addition, it listed the following selected pretax items as a December 31, 2019 and 2020: The preferred shares were outstanding during all of 2019 and 2020; annual dividends were declared and paid in each year. During 2019, 2,000 common shares were sold for cash on October 4. During 2020, a 20% stock dividend was declared and issued in early May. At the end of 2019 and 2020, the common stock was selling for 25.75 and 32.20, respectively. The company is subject to a 30% income tax rate. Required: 1. Prepare the comparative 2019 and 2020 income statements (multiple-step), and the related note that would appear in Anokas 2020 annual report. 2. Next Level Compute the price/earnings ratio for 2020. How does this compare to 2019? Why is it different?
- Hyde Corporations capital structure at December 31, 2018, was as follows: On July 2, 2019, Hyde issued a 10% stock dividend on its common stock and paid a cash dividend of 2.00 per share on its preferred stock. Net income for the year ended December 31, 2019, was 780,000. What should be Hydes 2019 basic earnings per share? a. 7.80 b. 7.09 c. 7.68 d. 6.73Tama Companys capital structure consists of common stock and convertible bonds. At the beginning of 2019, Tama had 15,000 shares of common stock outstanding; an additional 4,500 shares were issued on May 4. The 7% convertible bonds have a face value of 80,000 and were issued in 2016 at par. Each 1,000 bond is convertible into 25 shares of common stock; to date, none of the bonds have been converted. During 2019, the company earned net income of 79,200 and was subject to an income tax rate of 30%. Required: Compute the 2019 diluted earnings per share.Lyon Company shows the following condensed income statement information for the year ended December 31, 2019: Lyon declared dividends of 6,000 on preferred stock and 17,280 on common stock. At the beginning of 2019, 10,000 shares of common stock were outstanding. On May 1, 2019, the company issued 2,000 additional common shares, and on October 31, 2019, it issued a 20% stock dividend on its common stock. The preferred stock is not convertible. Required: 1. Compute the 2019 basic earnings per share. 2. Show the 2019 income statement disclosure of basic earnings per share. 3. Draft a related note to accompany the 2019 financial statements.
- Kent Corporation was organized on January 1, 2014. On that date, it issued 200,000 shares of 10 par value common stock at 15 per share (400,000 shares were authorized). During the period January 1, 2014, through December 31, 2019, Kent reported net income of 750,000 and paid cash dividends of 380,000. On January 5, 2019, Kent purchased 12,000 shares of its common stock at 12 per share. On December 28, 2019, 8,000 treasury shares were sold at 8 per share. Kent used the cost method of accounting for treasury shares. What is Kents total shareholders equity as of December 31, 2019? a. 3,290,000 b. 3,306,000 c. 3,338,000 d. 3,370,000Cash dividends on the 10 par value common stock of Garrett Company were as follows: The 4th-quarter cash dividend was declared on December 21, 2019, to shareholders of record on December 31, 2019. Payment of the 4th-quarter cash dividend was made on January 18, 2020. In addition, Garrett declared a 5% stock dividend on its 10 par value common stock on December 3, 2019, when there were 300,000 shares issued and outstanding and the market value of the common stock was 20 per share. The shares were issued on December 24, 2019. What was the effect on Garretts shareholders equity accounts as a result of the preceding transactions?Cary Corporation has 50,000 shares of 10 par common stock authorized. The following transactions took place during 2019, the first year of the corporations existence: Sold 5,000 shares of common stock for 18 per share. Issued 5,000 shares of common stock in exchange for a patent valued at 100,000. At the end of Carys first year, total contributed capital amounted to: a. 40,000 b. 90,000 c. 100,000 d. 190,000
- Roseau Company is preparing its annual earnings per share amounts to be disclosed on its 2019 income statement. It has collected the following information at the end of 2019: 1. Net income: 120,400. Included in the net income is income from continuing operations of 130,400 and a loss from discontinued operations (net of income taxes) of 10,000. Corporate income tax rate: 30%. 2. Common stock outstanding on January 1, 2019: 20,000 shares. 3. Common stock issuances during 2019: July 6, 4,000 shares; August 24, 3,000 shares. 4. Stock dividend: On October 19, 2019, the company declared a 10% stock dividend that resulted in 2,700 additional outstanding shares of common stock. 5. Common stock prices: 2019 average market price, 30 per share; 2019 ending market price, 27 per share. 6. 7% preferred stock outstanding on January 1, 2019: 1,000 shares. Terms: 100 par, nonconvertible. Current dividends have been paid. No preferred stock issued during 2019. 7. 8% convertible preferred stock outstanding on January 1, 2019: 800 shares. The stock was issued in 2018 at 130 per share. Each 100 par preferred stock is currently convertible into 1.7 shares of common stock. Current dividends have been paid. To date, no preferred stock has been converted. 8. Bonds payable outstanding on January 1, 2019: 100,000 face value. These bonds were issued several years ago at 97 and pay annual interest of 9.6%. The discount is being amortized in the amount of 300 per year. Each 1,000 bond is currently convertible into 22 shares of common stock. To date, no bonds have been converted. 9. Compensatory share options outstanding: Key executives may currently acquire 3,000 shares of common stock at 20 per share. The options were granted in 2018. To date, none have been exercised. The unrecognized compensation cost (net of tax) related to the options is 4 per share. Required: 1. Compute the basic earnings per share. Show supporting calculations. 2. Compute the diluted earnings per share. Show supporting calculations. 3. Show how Roseau would report these earnings per share figures on its 2019 income statement. Include an explanatory note to the financial statements.The controller of Red Lake Corporation has requested assistance in determining income, basic earnings per share, and diluted earnings per share for presentation on the companys income statement for the year ended September 30, 2020. As currently calculated, Red Lakes net income is 540,000 for fiscal year 2019-2020. Your working papers disclose the following opening balances and transactions in the companys capital stock accounts during the year: 1. Common stock (at October 1, 2019, stated value 10, authorized 300,000 shares; effective December 1, 2019, stated value 5, authorized 600,000 shares): Balance, October 1, 2019issued and outstanding 60,000 shares December 1, 201960,000 shares issued in a 2-for-l stock split December 1, 2019280,000 shares (stated value 5) issued at 39 per share 2. Treasury stockcommon: March 3, 2020purchased 40,000 shares at 38 per share April 1, 2020sold 40,000 shares at 40 per share 3. Noncompensatory stock purchase warrants, Series A (initially, each warrant was exchangeable with 60 for 1 common share; effective December 1, 2019, each warrant became exchangeable for 2 common shares at 30 per share): October 1, 201925,000 warrants issued at 6 each 4. Noncompensatory stock purchase warrants, Series B (each warrant is exchangeable with 40 for 1 common share): April 1, 202020,000 warrants authorized and issued at 10 each 5. First mortgage bonds, 5%, due 2029 (nonconvertible; priced to yield 5% when issued): Balance October 1, 2019authorized, issued, and outstandingthe face value of 1,400,000 6. Convertible debentures, 7%, due 2036 (initially, each 1,000 bond was convertible at any time until maturity into 20 common shares; effective December 1, 2019, the conversion rate became 40 shares for each bond): October 1, 2019authorized and issued at their face value (no premium or discount) of 2,400,000 The following table shows the average market prices for the companys securities during 2019-2020: Adjusted for stock split Required: Prepare a schedule computing: 1. the basic earnings per share 2. the diluted earnings per share that should be presented on Red Lakes income statement for the year ended September 30, 2020 A supporting schedule computing the numbers of shares to be used in these computations should also be prepared. Assume an income tax rate of 30%.Net Income and Comprehensive Income At the beginning of 2019, JR Companys shareholders equity was as follows: During 2019, the following events and transactions occurred: 1. JR recognized sales revenues of 108,000. It incurred cost of goods sold of 62,000 and operating expenses of 12,000, 2. JR issued 1,000 shares of its 5 par common stock for 14 per share. 3. JR invested 30,000 in available-for-sale securities. At the end of the year, the securities had a fair value of 35,000. 4. JR paid dividends of 6,000. The income tax rate on all items of income is 30%. Required: 1. Prepare a 2019 income statement for JR which includes net income and comprehensive income ignore earnings per share). 2. For 2016 prepare a separate (a) income statement (ignore earnings per share) and (b) statement of comprehensive income.