Exam 15: Stockholders Equity

Sealy Corporation had the following information in its financial statements for the years ended 2014 and 2015: What is the rate of return on common stock equity for Sealy Corporation for the year ended 2015?

Colson Inc. declared a $320,000 cash dividend. It currently has 12,000 shares of 7%, $100 par value cumulative preferred stock outstanding. It is one year in arrears on its preferred stock. How much cash will Colson distribute to the common stockholders?

In a corporate form of business organization, legal capital is best defined as

At December 31, 2014 and 2015, Plank Corp. had outstanding 4,000 shares of $100 par value 8% cumulative preferred stock and 20,000 shares of $10 par value common stock. At December 31, 2014, dividends in arrears on the preferred stock were $16,000. Cash dividends declared in 2015 totaled $60,000. What amounts were payable on each class of stock?

Presented below is information related to Orender, Inc.: What is Orender's rate of return on common stock equity for 2015?

Horton Co. was organized on January 2, 2014, with 500,000 authorized shares of $10 par value common stock. During 2014, Horton had the following capital transactions:January 5-issued 375,000 shares at $14 per share.July 27-purchased 25,000 shares at $11 per share.November 25-sold 18,000 shares of treasury stock at $13 per share.Horton used the cost method to record the purchase of the treasury shares. What would be the balance in the Paid-in Capital from Treasury Stock account at December 31, 2014?

Presented below is the stockholders' equity section of Oaks Corporation at December 31, 2014: During 2015, the following transactions occurred relating to stockholders' equity:3,000 shares were reacquired at $28 per share.3,000 shares were reacquired at $35 per share.1,800 shares of treasury stock were sold at $30 per share.For the year ended December 31, 2015, Oaks reported net income of $450,000. Assuming Oaks accounts for treasury stock under the cost method, what should it report as total stockholders' equity on its December 31, 2015, balance sheet?

Which of the following features of preferred stock makes it more like a debt than an equity instrument?

Mingenback Company has 560,000 shares of $10 par value common stock outstanding. During the year Mingenback declared a 15% stock dividend when the market price of the stock was $48 per share. Two months later Mingenback declared a $.60 per share cash dividend. As a result of the dividends declared during the year, retained earnings decreased by:

When a corporation issues its capital stock in payment for services, the least appropriate basis for recording the transaction is the

At its date of incorporation, Sauder, Inc. issued 100,000 shares of its $10 par common stock at $11 per share. During the current year, Sauder acquired 20,000 shares of its common stock at a price of $16 per share and accounted for them by the cost method. Subsequently, these shares were reissued at a price of $12 per share. There have been no other issuances or acquisitions of its own common stock. What effect does the reissuance of the stock have on the following accounts?

Glavine Company issues 6,000 shares of its $5 par value common stock having a fair value of $25 per share and 9,000 shares of its $15 par value preferred stock having a fair value of $20 per share for a lump sum of $297,000. The proceeds allocated to the common stock is

Percy Corporation was organized on January 1, 2014, with an authorization of 1,200,000 shares of common stock with a par value of $6 per share. During 2014, the corporation had the following capital transactions:January 5 issued 450,000 shares @ $10 per shareJuly 28 purchased 60,000 shares @ $11 per shareDecember 31 sold the 60,000 shares held in treasury @ $18 per sharePercy used the cost method to record the purchase and reissuance of the treasury shares. What is the total amount of additional paid-in capital as of December 31, 2014?

How should cumulative preferred dividends in arrears be shown in a corporation's statement of financial position?

Norton Company issues 4,000 shares of its $5 par value common stock having a fair value of $25 per share and 6,000 shares of its $15 par value preferred stock having a fair value of $20 per share for a lump sum of $210,000. What amount of the proceeds should be allocated to the preferred stock?

Treasury shares are shares

Wheeler Company issued 5,000 shares of its $5 par value common stock having a fair value of $25 per share and 7,500 shares of its $15 par value preferred stock having a fair value of $20 per share for a lump sum of $264,000. The proceeds allocated to the preferred stock is

The IFRS statement of recognized income and expenses

Callable preferred stock permits the corporation at its option to redeem the outstanding preferred shares at specified future dates and at stipulated prices.

True no-par stock should be carried in the accounts at issue price without any additional paid-in capital reported.