Neptune Corporation is preparing its December 31, 2018, balance sheet. The following items may be reported as either assets, liabilities or stockholders’ equity. a) Neptune invested $75,000 in an available for sale securities, fair value of which is $95,000 b) On October 1, 2018, the company borrowed $900,000 for 5 years at 8% per year. Interest is to be paid half-yearly on April 1 of every year. c) On December 15, 2018, the company declared a $1.50 per share dividend on the 60,000 shares of common stock outstanding, to be paid on January 25, 2019. Instructions: For each item above indicate the dollar amounts to be reported as assets, liabilities or stockholders’ equity. Mention the classification as well.
Neptune Corporation is preparing its December 31, 2018, balance sheet. The following items may be reported as either assets, liabilities or stockholders’ equity. a) Neptune invested $75,000 in an available for sale securities, fair value of which is $95,000 b) On October 1, 2018, the company borrowed $900,000 for 5 years at 8% per year. Interest is to be paid half-yearly on April 1 of every year. c) On December 15, 2018, the company declared a $1.50 per share dividend on the 60,000 shares of common stock outstanding, to be paid on January 25, 2019. Instructions: For each item above indicate the dollar amounts to be reported as assets, liabilities or stockholders’ equity. Mention the classification as well.
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 3P: On January 1, 2019, Kittson Company had a retained earnings balance of 218,600. It is subject to a...
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Neptune Corporation is preparing its December 31, 2018, balance sheet. The following items
may be reported as either assets, liabilities or
a) Neptune invested $75,000 in an available for sale securities, fair value of which is $95,000
b) On October 1, 2018, the company borrowed $900,000 for 5 years at 8% per year. Interest is to be paid half-yearly on April 1 of every year.
c) On December 15, 2018, the company declared a $1.50 per share dividend on the 60,000 shares of common stock outstanding, to be paid on January 25, 2019.
Instructions:
For each item above indicate the dollar amounts to be reported as assets, liabilities or stockholders’
equity. Mention the classification as well.
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