Stockholders' Equity (January 1)Common stock-$5 par value, 100,000 shares authorized, 40,000 shares issued andoutstandingPaid-in capital in excess of par value, common stockRetained earningsTotal stockholders' equityStockholders' Equity (December 31)Common stock-$5 par value, 100,000 shares authorized, 47,200 shares issued, 4,000shares in treasuryPaid-in capital in excess of par value, common stockRetained earnings ($40,000 restricted by treasury stock)$ 200,000160,000340,000$ 700,000$ 236,000210, 400400,000Less cost of treasury stockTotal stockholders' equityThe following transactions and events affected its equity during the year.January 5 Declared a $0.40 per share cash dividend, date of record January 10.March 20Purchased treasury stock for cash.April 5July 5July 31August 14October 5Declared a $0.40 per share cash dividend, date of record April 10.Declared a $0.40 per share cash dividend, date of record July 10.Declared a 20% stock dividend when the stock's market value was $12 per share.Issued the stock dividend that was declared on July 31.Declared a $0.40 per share cash dividend, date of record October 10.846,400(40,000)$ 806,400

1. January 5: Declared a $0.40 per share cash dividend, date of record January 10.Explanation: When…

Answered: Stockholders' Equity (January 1) Common…

Understanding Business

12th Edition

ISBN:9781259929434

Author:William Nickels

Publisher:William Nickels

Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment

Section: Chapter Questions

Problem 1CE

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The stockholders' equity section of Brent Corporation's balance sheet as of December 31, 2016 Stockholders' Equity Common stock, $5 par value; authorized, 2,000,000 shares; issued, 400,000 shares $2,000,000 Paid in capital in excess of par $850,000 Retained Earnings $3,000,000 Total $5,850,000 The following events occurred during 2017: 1.) Jan 5 10,000 shares of authorized and unissued common stock were sold for $9 per share. 2.) Jan 16 Declared a cash dividend of 40 cents per share, payable February 15 to stockholders of record on February 5. 3.) Feb 11 40,000 shares of authorized and unissued common stock were sold for $11 per share. 4.)Apr 1 A two-for-one split was…
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The board of directors is directly responsible to the stockholders.; True or False
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ESSAY. Write your answer in the space provided or on a separate sheet of paper. 1) Ms. Linda Udall owns 800 shares of Fordam Inc. that she acquired several years ago at $10 per share. On April 30, 2020, she acquires an additional 200 shares at $12 per share. On July 15, 2020, after Fordam releases unexpectedly bad second quarter results, Ms. Udall sells all 1,000 of her shares at $5 per share. On August 1, 2020, she purchases 200 shares at $1 per share as she believes the market has overreacted to the bad news. Ms. Udall is still holding the shares at the end of the year. What are the tax consequences of these transactions? 2) On July 1, 2020, Lorty InC. sells equipment for S126,000. This equipment had an original cost of $111,000 and a net book value of $93,000. For tax purposes, these assets were in Class 8. The UCC balance in this class on Januarv 1, 2020 was $103,000. There were no other additions or dispositions of Class 8 assets during the taxation vear ending December 31, 2020.…
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