CHAPTER 13 Corporations: Organization, Stock Transactions, and Dividends
Ex. 13–25
a. OfficeMax:
Staples:
b. Staples has a net loss of $(210,706,000) compared to OfficeMax’s net income
=Earnings per Share
Earnings per Share = Avg. Number of Common Shares Outstanding
Net Income – Preferred Dividends
Avg. Number of Common Shares Outstanding
Net Loss – Preferred Dividends
13-21
CHAPTER 13 Corporations: Organization, Stock Transactions, and Dividends
Prob. 13–1A
1.
Total Per Per
Dividends Total Share Total Share
2011…………
…
$ 20,000 $20,000 $0.20 $ 0 $0.00
2. Average annual dividend for preferred: $0.30 per share ($1.80 ÷ 6)
PROBLEMS
Year
Preferred Dividends Common Dividends
13-22
…
…
…
…
…
CHAPTER 13 Corporations: Organization, Stock Transactions, and Dividends
Prob. 13–2A
11 Building 3,375,000
Land 1,500,000
Common Stock (125,000 shares × $35) 4,375,000
Paid-In Capital in Excess of Par—
May
13-23
CHAPTER 13 Corporations: Organization, Stock Transactions, and Dividends
Prob. 13–3A
a. Cash (500,000 shares × $8)
Common Stock (500,000 shares × $3) 1,500,000
Paid-In Capital in Excess of Par—Common
Stock [500,000 shares × ($8 – $3)] 2,500,000
d. Cash (20,000 shares × $9)
Treasury Stock (20,000 shares × $7) 140,000
Paid-In Capital from Sale of Treasury Stock 40,000
[20,000 shares × ($9 – $7)]
e. Cash (5,000 shares × $6)
*
Beginning of year 80,000 shares 2,000,000 shares
(a) 500,000
(e) 5,000
90,000 shares 2,475,000 shares
Cash dividends per share $0.50 $0.08
30,000
180,000
Outstanding Shares of Stock
Common StockPreferred Stock
4,000,000
××
13-24
CHAPTER 13 Corporations: Organization, Stock Transactions, and Dividends
Prob. 13–4A
1. and 2.
Jan. 1 Bal. 7,500,000
Apr. 10 1,500,000
Jan. 1 Bal. 825,000
Apr. 10 300,000
Dec. 31 493,800 Jan. 1 Bal. 33,600,000
Dec. 31 1,125,000
Dec. 31 Bal. 34,231,200
Jan. 1 Bal. 450,000 June 6 450,000
June 6 200,000
Aug. 15 360,000 July 5 360,000
Common Stock
Paid-In Capital in Excess of Stated Value—Common Stock
Retained Earnings
Treasury Stock
Paid-In Capital from Sale of Treasury Stock
Stock Dividends Distributable
13-25
CHAPTER 13 Corporations: Organization, Stock Transactions, and Dividends
Prob. 13–4A (Continued)
2.
Jan. 22 Cash Dividends Payable 28,000
[(375,000 shares – 25,000 shares) × $0.08]
Cash 28,000
Apr. 10 Cash 1,800,000
(18,000 shares × $20)
Paid-In Capital in Excess of Stated Value— 90,000
Common Stock [18,000 shares × ($25 – $20)]
Aug. 15 Stock Dividends Distributable 360,000
Common Stock 360,000
13-26
CHAPTER 13 Corporations: Organization, Stock Transactions, and Dividends
Prob. 13–4A (Concluded)
3.
Retained earnings, January 1, 2016 $33,600,000
Net income $1,125,000
4.
Paid-in capital:
Common stock, $20 stated value (500,000 shares
authorized, 468,000 shares issued) $9,360,000
Excess of issue price over stated value 1,215,000
Stockholders’ Equity
MORROW ENTERPRISES INC.
Retained Earnings Statement
For the Year Ended December 31, 2016
13-27
CHAPTER 13 Corporations: Organization, Stock Transactions, and Dividends
Prob. 13–5A
Jan. 9 No entry required. The stockholders’ ledger would be revised to
record the increased number of shares held by each stockholder
and new par value.
Feb. 28 Treasury Stock (40,000 shares × $28) 1,120,000
Cash 1,120,000
Sept. 7 Cash (30,000 shares × $34) 1,020,000
Treasury Stock (30,000 shares × $28) 840,000
Paid-In Capital from Sale of Treasury
Stock [30,000 shares × ($34 – $28)] 180,000
Dec. 1 Cash Dividends Payable 202,800
Cash 202,800
13-28
CHAPTER 13 Corporations: Organization, Stock Transactions, and Dividends
Prob. 13–1B
1.
Total Per Per
Dividends Total Share Total Share
2011………… $ 24,000 $ 24,000 $ 0.96 $0 $0.00
2012………… 10,000 10,000 0.40 0 0.00
2. Average annual dividend for preferred: $1.80 per share ($10.80 ÷ 6)
3. a. 1.8% ($1.80 ÷ $100)
Year
Preferred Dividends Common Dividends
13-29
CHAPTER 13 Corporations: Organization, Stock Transactions, and Dividends
Prob. 13–2B
9 Cash 1,500,000
Mortgage Note Payable 1,500,000
17 Cash (20,000 shares × $126) 2,520,000
28 Building 4,150,000
Land 800,000
Oct.
13-30
CHAPTER 13 Corporations: Organization, Stock Transactions, and Dividends
Prob. 13–3B
a. Treasury Stock (87,500 shares × $8)
Cash 700,000
c. Cash (20,000 shares × $84)
Preferred Stock (20,000 shares × $80) 1,600,000
Paid-In Capital in Excess of Par—Preferred
Stock [20,000 shares × ($84 – $80)] 80,000
d. Cash (400,000 shares × $13)
e. Cash (18,000 shares × $7.50)
Paid-In Capital from Sale of Treasury Stock
[18,000 shares × ($8.00 – $7.50)]
*
Beginning of year 60,000 shares 1,750,000 shares
(a) (87,500)
(b) 55,000
(c) 20,000
Preferred Stock Common Stock
Outstanding Shares of Stock
9,000
135,000
700,000
1,680,000
5,200,000