![]() There were no dividends declared in 2012. has 5,000 shares of 5%, $100 par value, cumulative preferred stock and 30,000 shares of $1 par value common stock outstanding at December 31, 2014. What were the dividends on common stock in 2014? The payout ratio on common stock was 25%. Dividends on preferred stock were $400,000. Included in the net income was $300,000 of bond interest expense related to its long-term debt. had net income for 2014 of $2,120,000 and earnings per share on common stock of $5. 150 requires redeemable preferred stock to be listed as a liability on the balance sheet. Redeemable preferred stock should be classified as a liability on the balance sheet.įASB Statement No. Retained earnings is reduced by an amount equal to the number of shares issued times the par value per share. There should be no capitalization of retained earnings.ĭ. At what amount should retained earnings be capitalized for the additional shares issued?Ī. Jackson Corporation issued a 100% stock dividend of its common stock which had a par value of $.01, and a market value of $123 before the dividend and $62 after the dividend. outstanding less the number of treasury shares. Cash dividends are paid on the basis of the number of sharesĭ. The availability of funds must be considered. ![]() Before declaring a cash dividend, management must consider theĭ.
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