Exam 15: Accounting for Stockholders Equity

Betta Corporation issued 300,000 shares of $2 par value stock. The book value of Betta's common stockholders' equity is equal to $30 million. Betta implements a two-for-one stock split. Complete the following table: After the 2-for-1 split Shares outstanding Total par value Par value per share Total book value Book value per share

Caesar & Company reacquired 60,000 shares of its $1 par common stock for $10 per share on March 1. On April 1 they sold 10,000 treasury shares for $15 per share. On May 1 they sold 7,000 treasury shares for $6 per share. Assuming no prior balance in the Additional Paid-in Capital from Treasury Stock Transactions, what is the ending balance in this account following these transactions?

Small stock dividends are valued at the market price per share of stock at the date of declaration.

When issuing preferred shares instead of debt, corporations lose out on a valuable tax deduction.

Danio Fisheries issued 320,000 shares of $7 par value stock. The book value of Danio's common stockholders' equity is equal to $60 million. On August 1, Danio Fisheries implements a two-for-one stock split. After the stock split, the par value per share is ________ and the total book value is ________.

________ preferred shares contain a provision requiring that preferred shareholders share ratably in distributions with common shareholders.

On August 1, 2018, Omega Co. declared and issued a 30 percent common stock dividend. Prior to this, Omega Co. had 50,000 outstanding shares of $2 par value common stock. The market value of Omega Co.'s stock was $18 per share at the time the dividend was issued. As a result of this stock dividend, Omega Co.'s total stockholders' equity ________.

When earnings are volatile, the ________ ratio can be useful in evaluating a company because ________ value is generally more stable than net income.

TLR Productions issued 800 shares of its $4 par value common stock for $12 per share. What amount would they record as additional paid-in capital in excess of par-common?

Renoir Corporation reacquired 40,000 shares of its $1 par common stock for $19 per share on July 1. On August 1 they sold 10,000 treasury shares for $22 per share. What is the necessary journal entry for the August transaction?

On January 1, 2016, Warhol Company issued 1,000 shares of 10%, $200 par value, cumulative preferred stock for $300,000. No preferred dividends were declared in 2016 and 2017. On December 30, 2018, the Board declared $10,000 in dividends. What amount, if any, of preferred dividends are in arrears as of December 31, 2018?

Explain the reasons for reporting other comprehensive income separately from net income.

________ preferred shares are preferred shares for which redemption is certain at a specified price on a specified date.

Woods, Inc. issues common stock in exchange for legal services received. The common stock has a fair value of $9,000 and a par value of $600. What is the journal entry required to record this transaction?

Charmed, Inc. issued 100,000 shares of $4 par value stock. The book value of Charmed, Inc.'s common stockholders' equity is equal to $25 million. Charmed implements a two-for-one stock split. Complete the following table: Before the 2-for-1 split After the 2-for-1 split Shares outstanding Total par value Par value per share Total book value Book value per share

The par value method is the most popular method for reporting treasury stock transactions.

Dali's Dessert Company provides the following information from the Stockholders' Equity Section of the Balance Sheet: Common Stock, \ 1 par value, 100,000 shares issued and putstanding \ 100,000 Additional Paid-in Capital in Excess of Par-Common 900,000 Additional Paid-in Capital-Retired Shares 15,000 Retained Earnings 1,125,000 Total Stockholders' Equity \ 2,140,000 Dali acquired 15,000 shares of common stock in the open market at a price of $12 per share and retired the shares. What is the journal entry to record this transaction?

Fitzgerald Corporation has 58,000 shares authorized, 41,000 shares issued, and 8,000 shares of treasury stock. ________ shares are outstanding, and ________ shares are unissued.

Identify whether the stockholders' equity terminology belongs to U.S. GAAP, IFRS, or both. Contributed capital Share capital Retained earnings Common stock

On January 1, 2016, Moulin Company issued 1,200 shares of $60 par callable preferred shares for $180,000. According to the preferred share agreement, Moulin can call these preferred shares on January 1, 2018, for $150 per share. On January 1, 2018, Moulin calls the shares. a. What is the journal entry to record the issuance of the preferred shares? b. What is the journal entry when Moulin calls the preferred shares?