QS 11-12 (Algo) Dividend allocation between classes of shareholders LO C2 Stockholders' equity of Ernst Company consists of 89,000 shares of $5 par value, 9% cumulative preferred stock and 325,000 shares of $1 par value common stock. Both classes of stock have been outstanding since the company's inception. Ernst did not declare any dividends in the prior year, but it now declares and pays a $140,000 cash dividend at the current year-end. Determine the amount distributed to each class of stockholders for this two-year-old company. Calculation of preferred dividend: Total cash dividend To preferred shareholders To common shareholders Par Value per Preferred Share Dividend Rate % Dividend per Preferred Share Number of Preferred Shares Preferred Dividend for two years

QS 11-12 (Algo) Dividend allocation between classes of shareholders LO C2 Stockholders' equity of Ernst Company consists of 89,000 shares of $5 par value, 9% cumulative preferred stock and 325,000 shares of $1 par value common stock. Both classes of stock have been outstanding since the company's inception. Ernst did not declare any dividends in the prior year, but it now declares and pays a $140,000 cash dividend at the current year-end. Determine the amount distributed to each class of stockholders for this two-year-old company. Calculation of preferred dividend: Total cash dividend To preferred shareholders To common shareholders Par Value per Preferred Share Dividend Rate % Dividend per Preferred Share Number of Preferred Shares Preferred Dividend for two years

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter21: Corporations: Taxes, Earnings, Distributions, And The Statement Of Retained Earnings

Section: Chapter Questions

Problem 3SEB: COMMON AND PREFERRED CASH DIVIDENDS Ramirez Company currently has 100,000 shares of 1 par common...

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COMMON AND PREFERRED CASH DIVIDENDS Ramirez Company currently has 100,000 shares of 1 par common stock outstanding and 5,000 shares of 50 par preferred stock outstanding. On July 10, the board of directors declared a semiannual dividend of 0.30 per share on common stock to shareholders of record on August 1, payable on August 5. On July 15, the board of directors declared a semiannual dividend of 5 per share on preferred stock to shareholders of record on August 5, payable on August 10. Prepare journal entries for the declaration and payment of the common and preferred stock cash dividends.
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CASH DIVIDENDS, STOCK DIVIDEND, AND STOCK SPLIT During the year ended December 31, 20--, Baggio Company completed the following transactions: Apr. 15 Declared a semiannual dividend of 0.65 per share on preferred stock and 0.45 per share on common stock to shareholders of record on May 5, payable on May 10. Currently, 6,000 shares of 50 par preferred stock and 70,000 shares of 1 par common stock are outstanding. May 10 Paid the cash dividends. Oct. 15 Declared semiannual dividend of 0.65 per share on preferred stock and 0.45 per share on common stock to shareholders of record on November 5, payable on November 20. Nov. 20 Paid the cash dividends. 22 Declared a 10% stock dividend to shareholders of record on December 8, distributable on December 16. Market value of the common stock was estimated at 15 per share. Dec. 16 Issued certificates for common stock dividend. 20 Board of directors declared a two-for-one common stock split. REQUIRED Prepare journal entries for the transactions.