Bacon Inc. has the following stockholders' equity section in its May 31, 2019, comparative balance sheetsHay 31 2019April 30, 2019Paid-in capitaliPreferred stock, $150 par value, Sx, cumulative, 100,000 shares authorized,82,000 shares issued and outstandingComon stock, $6 par value, 600, 000 shares authorized, 350,000 and 330,000shares issued, respectivelyAdditional paid-in capitalRetained earningsLess: Treasury conmon stock, at cost; 20,000 shares and 19,000 shares,respectivelyTotal stockholders' equity$12,300,000$12, 300,00014,820,00012,228, 0001,980, 00014,440, 00011,944,000(1,840,000)(1,824,000)$38,840,000g. Assume that instead of the stock dividend described in f, the board of directors authorized a 2-for-1 stock split on June 1 when themarket price of the common stock was $34 per share.1. What will be the par value, and how many shares of common stock will be authorized after the split?Par valueNumber of shares2. What will be the market price per share of common stock after the split?Market price3. How many shares of common stock will be in the treasury after the split?Number of shares

1) Given stock split is 2 for 1 which means that every one stock will be split into two stock.…

Bacon Inc. has the following stockholders' equity section in its May 31, 2019, comparative balance sheets Hay 31, 2019 April 30, 2019 Paid-in capital: Preferred stock, si50 par value, sx, cumulative, 100,000 shares authorized, 82,000 shares issued and outstanding Conmon stock, $6 par value, 600,000 shares authorized, 350,000 and 330,000 shares issued, respectively Additional pald-in capital Retained earnings Lesst Treasury conmon stock, at cost; 20,000 shares and 19,000 shares, respectively Total stockholders equity $12, 300,000 $12, 300,000 14,820,000 12,220,000 1,980,000 14,440,000 11,944,000 (1,824, 000) $38,840,000 (1,840,000) 9. Assume that instead of the stock dividend described in f, the board of directors authorized a 2-for-1 stock split on June 1 when the market price of the common stock was $34 per share. 1. Whet will be the par value, and how many shares of common stock will be authorized after the split? Par value Number of shares 2. What will be the market price per share of common stock after the split? Market price 3. How many shares of common stock will be in the treasury after the split? Number of shares

Bacon Inc. has the following stockholders' equity section in its May 31, 2019, comparative balance sheets Hay 31, 2019 April 30, 2019 Paid-in capital: Preferred stock, si50 par value, sx, cumulative, 100,000 shares authorized, 82,000 shares issued and outstanding Conmon stock, $6 par value, 600,000 shares authorized, 350,000 and 330,000 shares issued, respectively Additional pald-in capital Retained earnings Lesst Treasury conmon stock, at cost; 20,000 shares and 19,000 shares, respectively Total stockholders equity $12, 300,000 $12, 300,000 14,820,000 12,220,000 1,980,000 14,440,000 11,944,000 (1,824, 000) $38,840,000 (1,840,000) 9. Assume that instead of the stock dividend described in f, the board of directors authorized a 2-for-1 stock split on June 1 when the market price of the common stock was $34 per share. 1. Whet will be the par value, and how many shares of common stock will be authorized after the split? Par value Number of shares 2. What will be the market price per share of common stock after the split? Market price 3. How many shares of common stock will be in the treasury after the split? Number of shares

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter16: Retained Earnings And Earnings Per Share

Section: Chapter Questions

Problem 18E: Monona Company reported net income of 29,975 for 2019. During all of 2019, Monona had 1,000 shares...

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Raun Company had the following equity items as of December 31, 2019: Preferred stock, 9% cumulative, 100 par, convertible Paid-in capital in excess of par value on preferred stock Common stock, 1 stated value Paid-in capital in excess of stated value on common stock| Retained earnings The following additional information about Raun was available for the year ended December 31, 2019: 1. There were 2 million shares of preferred stock authorized, of which 1 million were outstanding. All 1 million shares outstanding were issued on January 2, 2016, for 120 a share. The preferred stock is convertible into common stock on a 1-for-1 basis until December 31, 2025; thereafter, the preferred stock ceases to be convertible and is callable at par value by the company. No preferred stock has been converted into common stock, and there were no dividends in arrears at December 31, 2019. 2. The common stock has been issued at amounts above stated value per share since incorporation in 2002. Of the 5 million shares authorized, 3,580,000 were outstanding at January 1, 2019. The market price of the outstanding common stock has increased slowly but consistently for the last 5 years. 3. Raun has an employee share option plan where certain key employees and officers may purchase shares of common stock at 100% of the marker price at the date of the option grant. All options are exercisable in installments of one-third each year, commencing 1 year after the date of the grant, and expire if not exercised within 4 years of the grant date. On January 1, 2019, options for 70,000 shares were outstanding at prices ranging from 47 to 83 a share. Options for 20,000 shares were exercised at 47 to 79 a share during 2019. During 2019, no options expired and additional options for 15,000 shares were granted at 86 a share. The 65,000 options outstanding at December 31, 2019, were exercisable at 54 to 86 a share; of these, 30,000 were exercisable at that date at prices ranging from 54 to 79 a share. 4. Raun also has an employee share purchase plan whereby the company pays one-half and the employee pays one-half of the market price of the stock at the date of the subscription. During 2019, employees subscribed to 60,000 shares at an average price of 87 a share. All 60,000 shares were paid for and issued late in September 2019. 5. On December 31, 2019, there was a total of 355,000 shares of common stock set aside for the granting of future share options and for future purchases under the employee share purchase plan. The only changes in the shareholders equity for 2019 were those described previously, the 2019 net income, and the cash dividends paid. Required: Prepare the shareholders equity section of Rauns balance sheet at December 31, 2019. Substitute, where appropriate, Xs for unknown dollar amounts. Use good form and provide full disclosure. Write appropriate notes as they should appear in the publisher financial statements.
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.
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. 6.73
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.
Statement of Stockholders' Equity At the end of 2019, Stanley Utilities Inc. had the following equity accounts and balances: During 2020, Stanley Utilities engaged in the following transactions involving its equity accounts: Sold 3,300 shares of common stock for $15 per share. Sold 1,000 shares of 12%, $100 par preferred stock at $105 per share. Declared and paid cash dividends of $8,000. Repurchased 1,000 shares of treasury stock (common) for $38 per share. Sold 400 of the treasury shares for $42 per share. Required: Prepare the journal entries for Transactions a through e. Assume that 2020 net income was $87,000. Prepare a statement of stockholders equity at December 31, 2020.
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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.
Calculating the Number of Shares Issued Castalia Inc. issued shares of its $0.80 par value common stock on September 4, 2019, for $8 per share. The Additional Paid-In Capital-Common Stock account was credited for 5612,000 in the journal entry to record this transaction. Required: How many shares were issued on September 4, 2019?
Treasury Stock, Cost Method Bush-Caine Company reported the following data on its December 31, 2018, balance sheet: The following transactions were reported by the company during 2019: 1. Reacquired 200 shares of its preferred stock at 57 per share. 2. Reacquired 500 shares of its common stock at 16 per share. 3. Sold 100 shares of preferred treasury stock at 58 per share. 4. Sold 200 shares of common treasury stock at 17 per share. 5. Sold 100 shares of common treasury stock at 9 per share. 6. Retired the shares of common stock remaining in the treasury. The company maintains separate treasury stock accounts and related additional paid-in capital accounts for each class of stock. Required: 1. Prepare the journal entries required to record the treasury stock transactions using the cost method. 2. Assuming the company earned a net income in 2019 of 30.000 and declared and paid dividends of 10,000, prepare the shareholders equity section of its balance sheet at December 31, 2019.
Jumbo Corporation reported the following information about its stock on its December 31, 2018, balance sheet: Jumbo Corporation engaged in the following stock transactions during 2019: Required: 1. Does Jumbo Corporation have a simple or complex capital structure? 2. Calculate the number of shares that Jumbo would use to calculate basic EPS for its 2019 income statement.
Tama 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.