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Unformatted text preview: E14-2 Perez Corporation was organized on January 1, 2009. During its first year, the corporation issued 2,000 shares of $50 par value preferred common stock. At December 31, the company declared the following cash dividends: 2009, $6,000, 2010, $12,000, and 2011, $28,000. Show the allocation of dividends to each class of stock, assuming the preferred stock dividend is 7% and not cumulative. blank.) 2009 Total dividend declaration Allocation to preferred stock Remainder to common stock Show the allocation of dividends to each class of stock, assuming the preferred stock dividend is 8% and cumulative. blank.) 2009 Total dividend declaration Allocation to preferred stock Remainder to common stock Journalize the declaration of the cash dividend at December 31, 2011, under previous question above. Date Account/Description Dec. 31 E14-3 On January 1, 2010, Deweese Corporation had $1,000,000 of common stock outstanding that was issued at par. It also had retained earnings of $750,000. The company issued 40,000 shares of common stock at par on July 1 and earned net income of $400,000 for the year. Instructions Journalize the declaration of a 15% stock dividend on December 10, 2010, for the following independent assumptions. (For multiple debit/credit entries, list amounts from largest to smallest eg 10, 5, 3, 2.) 1. Par value is $10, and market value is $18. 2. Par value is $5, and market value is $20. Account/Description Debit Credit 1. 2. E14-4 On October 31, the stockholders' equity section of Huth Company consists of common stock $300,000 and retained earnings $900,000. Huth is considering the following two courses of action: (1) declaring a 5% stock dividend on the 30,000, $10 par value shares outstanding, or (2) effecting a 2-for-1 stock split that will reduce par value to $5 per share. The current market price is $14 per share. Instructions Complete the tabular summary of the effects of the alternative actions on the components of stockholders' equity, outstanding shares, and par value per share. Complete the tabular summary of the effects of the alternative actions on the components of stockholders' equity, outstanding shares, and par value per share....
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This note was uploaded on 01/05/2012 for the course 101 melissa jo taught by Professor Acc101 during the Spring '11 term at Aarhus Universitet.
- Spring '11