Pearson eText Foundations of Finance -- Instant Access (Pearson+)
10th Edition
ISBN: 9780135639382
Author: Arthur Keown, John Martin
Publisher: PEARSON+
expand_more
expand_more
format_list_bulleted
Concept explainers
Question
Chapter 13, Problem 12SP
a)
Summary Introduction
To determine: The earnings per share.
b)
Summary Introduction
To determine: The earnings per share.
c)
Summary Introduction
To determine: The earnings in dollar in respective cases.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
As of 2017, Buttle Corp. has $10 par, 2% preferred stock, 13,000 shares outstanding,
and $1 par common stock with 64,000 shares outstanding. The preferred stock is
cumulative and preferred stockholders last received a dividend in 2014.
If the company wants to distribute $4 per share to the common stockholders in 2017,
what is the total amount of dividends that the company must pay at the end of the
current year?
Select one:
a. None of these are correct. X
b. $256,000
c. $263,800
d. $258,600
e. $7,800
On August 15, 2021, EasyMoney, Inc.'s Board of Directors meets and declares that EasyMoney
will pay a dividend to its stockholders. Each share of EasyMoney's Common Stock will be paid a
dividend of $1.25 per share. There are currently 100,000 shares of EasyMoney's Common Stock
held by EasyMoney's shareholders.
The following are the facts related to this dividend:
D Dividend
per Share
D Date of Declaration
D Date of Record
D Date of Payment
$1.25
August 15, 2021
September 5, 2021
September 20, 2021
The following is a partial list of the accounts in EasyMoney, Inc.'s General Ledger. These are the
only accounts you need for this problem.
D Cash
D Dividends Payable
> Retained Earnings
As of August 1, 2021, the Beginning Balance in the Dividends Payable account is $0 and the
Beginning Balance in the Retained Earnings account is $625,000.
On August 15, 2021, EasyMoney, Inc.s Board of Directors meets. and declares that EasyMoney
will pay a dividend to its stockholders. Each share of EasyMoney's Common Stock will be paid a
dividend of $1.25 per share. There are currently 100,000 shares of EasyMoney's Common Stock
held by EasyMoney's shareholders.
The following are the facts related to this dividend:
D Dividend per Share
D Date of Declaration
> Date of Record
D Date of Payment
$1.25
August 15, 2021
Septembe5, 2021
September 20, 2021
The following is a partial list of the accounts in EasyMoney, Inc.'s General Ledger. These are the
only accounts you need for this problem.
> Cash
D Dividends Payable
> Retained Eamings
As of August 1, 2021, the Beginning Balance in the Dividends Payable account is $0 and the
Beginning Balance in the Retained Eamings account is $625,000.
ording Dividends
uirement 1
August 15 Dividend declaration entry
Date
Account Hame
Debir
Credi
B. Alter posting the abovs
Chapter 13 Solutions
Pearson eText Foundations of Finance -- Instant Access (Pearson+)
Ch. 13 - What is meant by the term dividend payout ratio?Ch. 13 - Prob. 2RQCh. 13 - Prob. 3RQCh. 13 - Prob. 4RQCh. 13 - Prob. 5RQCh. 13 - Prob. 6RQCh. 13 - Prob. 7RQCh. 13 - Prob. 8RQCh. 13 - Prob. 9RQCh. 13 - Prob. 10RQ
Ch. 13 - Prob. 1SPCh. 13 - (Dividend policy and the issue of new shares of...Ch. 13 - Prob. 3SPCh. 13 - (Dividend policy and stock prices) The issue as to...Ch. 13 - (Residual dividend policy) FarmCo, Inc. follows a...Ch. 13 - (Legal restrictions on dividend payments) Describe...Ch. 13 - (Practical considerations in setting dividend...Ch. 13 - Prob. 8SPCh. 13 - Prob. 9SPCh. 13 - Prob. 10SPCh. 13 - Prob. 11SPCh. 13 - Prob. 12SPCh. 13 - Prob. 13SPCh. 13 - Prob. 14SPCh. 13 - Prob. 15SPCh. 13 - Prob. 16SPCh. 13 - Prob. 1.1MCCh. 13 - The executive vice-president in charge of finance...Ch. 13 - Prob. 2.1MCCh. 13 - Prob. 2.2MCCh. 13 - Prob. 2.3MC
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.Similar questions
- Austin Motor Works declared and distributed a 5% stock dividend in 2022 when the stock was selling for $18 per share. There were 6,000,000 shares outstanding at the time of the dividend declaration. The controller recorded the distribution at par value ($1 per share) resulting in a debit to Dividends and a credit to Common Stock for $300,000. Upon review in early 2023 when the 2022 books were still open, the CFO made which of the following correcting entries? (Abbreviations used: APIC = Additional Paid-In Capital) Group of answer choices Dividends 5,100,000 Common Stock 5,100,000 APIC in Excess of Par-Common 5,100,000 Common Stock5,100,000 Dividends 5,100,000 APIC in Excess of Par-Common 5,100,000 He made no entry because the controller was correct.arrow_forwardThe following excerpt is from an article reported in the May 7, 2014, online issue of Bloomberg. (Blomberg) Ford Motor Co. (F) said it will repurchase $1.8 billion of its shares to reduce dilution from recent stock grants to executives. The par amount per share for Ford ’s common stock is $0.01. Paid-in capital—excess of par is $5.39 per share on average. The market price was $16. Required: 1. Suppose Ford reacquires 112 million shares through repurchase on the open market at $16 per share. Prepare the appropriate journal entry to record the purchase. Ford considers the shares it buys back to be treasury stock. 2. Suppose Ford considers the shares it buys back to be retired rather than treated as treasury stock. Prepare the appropriate journal entry to record the purchase. 3. What does the company mean by saying that the buyback will serve “to offset dilution from executive compensation”?arrow_forward. Li Travel Company reported net income for 2021 in the amount of $900,000. During2021, Li declared and paid $21,250 in cash dividends on its nonconvertible preferredstock. Li also paid $10,000 cash dividends on its common stock. Li had 400,000common shares outstanding from January 1 until 100,000 new shares were sold forcash on April 1, 2021. What is 2021 basic earnings per share?a. $1.85.b. $1.64.c. $1.76.d. None of these answer choices is correct.arrow_forward
- Towson Corp., was organized on January 2, 2018. During the first year of operation, Towson issued 60,000 shares of $2 par value common stock at a price of $50 cash per share. On December 31, 2018, Towson reported Net Income of $250,000 and paid $50,000 cash dividends. Use this information to determine the dollar amounts that Towson will report on its year end Balance Sheet for Paid in Capital Common Stock in Excess to par.arrow_forwardLola Inc. must compute EPS for its 2020 reports. The following information is available to the controller. • Net income is $30 million (before tax it is $50 million). • Common stock (20 million shares authorized; 15 million shares outstanding January 1, 2020). • Cumulative convertible preferred stock (2 million shares issued August 1, 2017, and outstanding January 1, 2020). The stock was issued at $50 a share with a yearly $4 dividend declared and paid semiannually on June 30 and December 31. The stock is convertible on a share-for-share basis adjusted automatically for any stock dividends or splits. Dividends are paid for time stock is held. • March 1, 2020: Half of the preferred stock was converted to common stock. • April 1, 2020: Lola declared a 10% stock dividend. • July 1, 2020: One million shares of stock were issued in the acquisition of Grande Corporation. The stock’s fair value at this time was $15 a share. • October 1, 2020: Lola purchased and retired 600,000 shares of its…arrow_forwardIn 2016, Poe's Products completed the treasury stock transactions described below. January 2: Reacquired 10 million shares at $16 per share. February 15: Sold 3 million shares at $20 per share. September 20: Sold 3 million treasury shares at $15 per share. Poe had issued 50 million shares of its $1 par common stock for $18 several years ago. Required: Record the above transactions, assuming that Poe's Products uses the cost method.arrow_forward
- Lord Aguilar Corp. plans to declare and distribute a dividend in December 2018. There are 20,000 shares of 7% preference shares, par value P50, and 400,000 outstanding ordinary shares, P1 par value. No dividend was paid in the previous year. 1. What is the total amount of dividends to be paid to ordinary shareholders if preference shares are cumulative and nonparticipating and the dividend declared is P100,000? 2. What is the total amount of dividends to be paid to preference shareholders if it is cumulative and nonparticipating and the dividend declared is P100,000? 3. What is the total amount of dividends to be paid to ordinary shareholders if preference shares are cumulative and nonparticipating and the dividend declared is P168,000?arrow_forwardGleneagles Corporation earned net income of $70,000 during the year ended December 31, 2020. On December 15, Gleneagles had declared the annual cash dividend on its $0.50 preferred shares (10,000 shares issued for $100,000) and a $0.60 per share cash dividend on its common shares (25,000 shares for $50,000). Gleneagles then paid the dividends on January 4, 2021. Journalize the following for Gleneagles Corporation: a. Declaring the cash dividends on December 15, 2020 b. Paying the cash dividends on January 4, 2021 Did Retained Earnings increase or decrease during 2020? By how much?arrow_forwardHello! I need help with the following accounting problem: Bramble Inc. obtained significant influence over Kasey Corporation by buying 25% of Kasey's 32,700 outstanding shares of common stock at a total cost of $10 per share on January 1, 2022. On June 15, Kasey declared and paid a cash dividend of $31,600. On December 31, Kasey reported a net income of $116,000 for the year. Prepare all the neccesary journal entries for 2022 for Bramble inc. Thank you!arrow_forward
- During 2018, Longhorn Corp. had net income of $300,000 and paid dividends to its preferred shareholders in the amount of $20,000. On January 1, 2018, the start of the year, the company had 100,000 common shares issued. On April 1, the company issued another 50,000 common shares. What is the weighted average number of shares on December 31, 2018? a. 137,500 shares b. 50,000 shares c. 150,000 shares d. 62,500 sharesarrow_forwardbefore any dividends are paid on the common stock. During its first five years of business (2011 through 2015), the company earned income totaling $3,700,000 and paid dividends of 50 cents per share each year on the common stock outstanding. On January 2, 2013, the company purchased 20,000 shares of its own common stock in the open market for $400,000. On January 2, 2015, it reissued 10,000 shares of this treasury stock for $250,000. The remaining 10,000 were still held in treasury at December 31, 2015. instructions a. Prepare the stockho!ders' equity section of the balance sheet for Herndon Industries at December 31, 2015. Include supporting schedules showing (1) your computation of any paid- in capital on treasury stock and (2) retained earnings at the balance sheet date. (Hint: Income increases retained earnings, whereas dividends reduce retained earnings. Dividends are not paid on shares of stock held in treasury.) b. As of December 31, compute Herndon's book value per share of…arrow_forwardOn January 1, 2020 ,Herron Corporation purchased 5,000 shares of treasury stock. Other information regarding Herron Corporation is provided as follows. Compute (a) return on common stockholders' equity for each year, and (b) discuss the changes in each. 2018 2017 Net income $100,000 $110,000 Dividends on preferred stock $ 30,000 $ 30,000 Dividends on common stock $ 25,000 $ 15,000 Weighted-average number of common shares outstanding 45,000 50,000 Common stockholders' equity beginning of year $750,000 $685,000 Common stockholders' equity end of year $795000 $750,000arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Financial AccountingAccountingISBN:9781305088436Author:Carl Warren, Jim Reeve, Jonathan DuchacPublisher:Cengage Learning
Principles of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax College
Financial Accounting
Accounting
ISBN:9781305088436
Author:Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax College