week 5 - 15-7 a) At date of declaration (December 21, 2007)...

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15-7 a) At date of declaration (December 21, 2007) 6% on the preferred stock Retained earnings $12,000.00 CASH $12,000.00 Computatio: (6% x $200,000) = 12,000 Prefferred stocks in arrear Retained earnings $12,000.00 Treasury stock $12,000.00 Computation: 1,500 shares X $8 share $12,000.00 $0.30 per share common stock Retained earning $89,190.00 Cash $89,190.00 Computation: Common stock as of 12/31/06 $300,000.00 Less treasury stock $4,200.00 Total as of 12/31/06 $295,800.00 Less paid in arrear $1,500.00 Total remaining for common $294,300.00 Common stock at .30/share X0.30 Common stock cash dividend $88,290.00 b) Yes Preffered stock in arrear $12,000.00 Current preferred stock $12,000.00 Common stock $89,190.00 Total stock to be paid $113,190.00 Balance $105,000.00 Plus net incom $77,000.00 Available cash $182,000.00 Less treasury stock $33,600.00 Available cash $148,400.00 Available > required 148,400 > 113,190
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a) Total Assets Decrease cash (0.50*10,000 shares) $(5,000.00) Common stock no effect Paid in capital in excess of par no effect Retained earning Decrease (10,000*.50) $(5,000.00)
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This note was uploaded on 01/08/2010 for the course ACC 551 taught by Professor None during the Spring '09 term at Ill. Chicago.

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week 5 - 15-7 a) At date of declaration (December 21, 2007)...

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