For 2010 and 2011, Sabil Corporation earned net income of $480,000 and S640.000 and paid dividends of s20.000, respectively. At January 1, 2010, Sabil had $200,000 of $10 par valne common stock dutstanding and $1,500.000 of retained earnings. On January 1 of each of these years, Phyit Corporation bought 10% of the outstanding common stock of Sabil paying s200,000 per 10% block on January 1, 2010 and 2011. All payments made by Phyit in excess of book value were attributable to equipment, which is depreciated over ten years on a straight-line basis Required U'sing the appropriate accounting methods, show all journal entries that Phyit Corporation had recorded in its books for both years 2010 Ind 2011 following the proper chronological orded

For 2010 and 2011, Sabil Corporation earned net income of $480,000 and S640.000 and paid dividends of s20.000, respectively. At January 1, 2010, Sabil had $200,000 of $10 par valne common stock dutstanding and $1,500.000 of retained earnings. On January 1 of each of these years, Phyit Corporation bought 10% of the outstanding common stock of Sabil paying s200,000 per 10% block on January 1, 2010 and 2011. All payments made by Phyit in excess of book value were attributable to equipment, which is depreciated over ten years on a straight-line basis Required U'sing the appropriate accounting methods, show all journal entries that Phyit Corporation had recorded in its books for both years 2010 Ind 2011 following the proper chronological orded

Name: For 2010 and 2011, Sabil Corporation earned net income of $480.000 an
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Description: For 2010 and 2011, Sabil Corporation earned net income of $480.000 and $640.000 and paid dividends of S18.000 ands20.000, respectively. At January 1, 2010, Sabil had $200,000 of S10 par value common stock dutstanding and$1,500,000 of retained earnin

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter16: Retained Earnings And Earnings Per Share

Section: Chapter Questions

Problem 3P: On January 1, 2019, Kittson Company had a retained earnings balance of 218,600. It is subject to a...

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On January 1, 2019, Kittson Company had a retained earnings balance of 218,600. It is subject to a 30% corporate income tax rate. During 2019, Kittson earned net income of 67,000, and the following events occurred: 1. Cash dividends of 3 per share on 4,000 shares of common stock were declared and paid. 2. A small stock dividend was declared and issued. The dividend consisted of 600 shares of 10 par common stock. On the date of declaration, the market price of the companys common stock was 36 per share. 3. The company recalled and retired 500 shares of 100 par preferred stock. The call price was 125 per share; the stock had originally been issued for 110 per share. 4. The company discovered that it had erroneously recorded depreciation expense of 45,000 in 2018 for both financial reporting and income tax reporting. The correct depreciation for 2018 should have been 20,000. This is considered a material error. Required: 1. Prepare journal entries to record Items 1 through 4. 2. Prepare Kittsons statement of retained earnings for the year ended December 31, 2019.
Hyde Corporations capital structure at December 31, 2018, was as follows: On July 2, 2019, Hyde issued a 10% stock dividend on its common stock and paid a cash dividend of 2.00 per share on its preferred stock. Net income for the year ended December 31, 2019, was 780,000. What should be Hydes 2019 basic earnings per share? a. 7.80 b. 7.09 c. 7.68 d. 6.73
On January 1, 2021, MNO Company acquired 12,500 of the outstanding common shares of Esther Corporation stocks at P40 per share. Esther Corp. had a total of 62,500 shares outstanding on the same date. Esther Corp. declared total dividends of P20,000 to shareholders on December 20, 2021 and reported a net income of P150,000 for 2021. What is the amount of dividend income to be presented in profit or loss for the year ended December 31, 2021? 5.
On January 1, 2021, Eugene Co. had retained earnings of P1,240,000. During 2021, the co. earned net income of P456,000. The following transactions occurred:a. Cash dividends of P12 per share on 42,000 shares of ordinary shares were declared and paid.b. A small share dividend was declared and issued. The dividend consisted of 6,620 shares of P25 par ordinary share. On the date of declaration, the market price of the company’s ordinary share was P34 per share.c. The co. recalled and retired 12,100 shares of P50 par preferred share. The call price was P93 per share; the share had originally been issued for P80 per share. d. The Eugene discovered that it had erroneously recorded depreciation expense of P200,000 in 2019 for both financial and tax reporting. The correct depreciation for 2019 had been P275,000. This is considered a material error. Assume tax rate of 25%. The balance of retained earnings on December 31, 2021:
For the year ending 30 June 2020, Don Ltd reports a net profit after tax of $6.1 million. At the beginning of the financial year Evita Ltd had 2,500,000 fully paid ordinary shares outstanding. Don Ltd also had 1,000,000 partly paid shares. These shares were partly paid to 0.50 cents and had an original issue price of $1. The partly paid shares carry the rights to dividends in proportion to the amount paid relative to the total issue price. They were still partly paid at year end. Don Ltd also has the following securities outstanding: • $2.0 million of 10 per cent notes issued on 1 July 2019. The notes have a life of five years and give holders the right to convert the notes into 500,000 fully paid ordinary shares. • In 2016, employees were provided with options, at no initial cost, which gave them the right to acquire 750,000 shares at an exercise price of $2.50. The options expire five years after their original issue date. Given the time period to option expiry, the directors believe…
on 1/1/20, ABC Corp bought 500 shares of XYZ Corp for $10,000. XYZ Corp has 25,000 shares outstanding. on 6/1/20, XYZ pays a $100,000 cash dividend to all shareholders. On 12/31/20, XYZ is trading at $22/share and during 2020 XYZ reported net income of $250,000. What is the total effect on net income for ABC from this investment? Assume ABC reports annually on a calendar year basis.
On July 1, 2010, Bettina Company's board of directors declared a 10% share dividend. The market price of Bettina's 400.000 outstanding ordinary shares, P50 par value, was P80 per share on the date of declaration. The share dividend was distributed on September 1, 2010 when the market price of the shares was P100 per share. What amount should be charged to the Accumulated Profits and Losses account as a result of the share dividend?
For 2018, Sabil Corporation earned net income of $480,000 and paid dividends of $18,000. At January 1, 2018, Sabil had $200,000 of $10 par value common stock outstanding and $1,500,000 of retained earnings.On January 1, 2018, Phyit Corporation bought outstanding common stock of Sabil paying $200,000. All payments made by Phyit in excess of book value were attributable to equipment, which is depreciated over ten years on a straight-line basis. Prepare Phyit’s general journal entry for the acquisition of common stock of Sabil, the recognition of dividend income, and/or net income participation in Sabil under the following assumptions:1. Phyit purchased 10% of outstanding common stock.2. Phyit purchased 20% of outstanding common stock.
Denden Company was organized on January 1, 2020 at which date it issued 300,000 ordinary shares of P6 par value at P13 per share. The following are the additional equity transaction occurred during the year: Profit for the year amounts to P975,000 Declared and paid cash dividends amounts to P225,000 On January 10, 2020, the Company purchased 9,000 treasury shares at P12 per share. On December 31, 2020, the Company sold 4,500 treasury shares at P8 per share and retired the remaining treasury shares. The company uses the cost method of accounting for treasury shares. What is the total shareholder’s equity on December 31, 2020?
On July 1, 2020, ABC Corporation invested in the stocks of XYZ foreign corporation, by acquiring 10,000 shares at P12/share. On December 20,2020, XYZ declared a 20% stock dividend payable on January 15, 2021. On January 2, 2021, ABC Corporation sold 10,000 shares for P13/share.Compute the net capital gain to be included in regular income.
Marlene Co. had 300 million shares of $1 par common stock outstanding at January 1, 2021. In October 2021, Marlene Co.’s Board of Directors declared and distributed a 1% common stock dividend when the market value of its common stock was $60 per share. In recording this transaction, Marlene would: a. Debit retained earnings for $180 million. b. Credit paid-in capital—excess of par for $180 million. c. Credit common stock for $180 million. d. None of these answer choices correct.
The PowerPoint Corporation has two classes of share capital outstanding: 9% (dividend rate), P20 par, Preference and P70 par, Ordinary. During the fiscal year ending December 31, 2012, the company had the equity transactions in chronological order as reflected in the table below. Dividends were paid at the end of the fiscal year on the ordinary share at P1.20 per share and on the preference at the preference rate. Profit for the year was P850,000. How much should be the amount of Preference Share Capital to be shown on the December 31, 2012 statement of financial position? How much should be the amount of Ordinary Share Capital to be shown on the December 31, 2012 statement of financial position? a. P9,450,000 b. P9,310,000 c. P9,130,000 d. P4,725,000