FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Loanable Funds Theory
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Final Questions Shaded cells have feedback. X b. Determine the following amounts before the stock dividend was declared: (1) total paid-in capital, (2) total retained earnings, and (3) total stockholders' equity. Total paid-in capital Total retained earnings $ Total stockholders' equity $
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Transcribed Image Text:Final Questions Shaded cells have feedback. X b. Determine the following amounts before the stock dividend was declared: (1) total paid-in capital, (2) total retained earnings, and (3) total stockholders' equity. Total paid-in capital Total retained earnings $ Total stockholders' equity $
Instructions Advanced Life Co. is an HMO for businesses in the Albuquerque area. The following account balances appear on the balance sheet of Advanced Life Co.: Common stock (600,000 shares authorized; 400,000 shares issued), S8 par. $3,200,000; Paid-in capital in excess of par-common stock, S800,000; and Retained earnings, $25,600,000. The board of directors declared a 2% stock dividend when the market price of the stock was $19 a share. Advanced Life Co. reported no income or loss for the current year. Required: a. Journalize the entries to record (1) the declaration of the dividend on December 1, capitalizing an amount equal to market value, and (2) the issuance of the stock certificates on December 31. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered. b. Determine the following amounts before the stock dividend was declared: (1) total paid-in capital, (2) total retained earnings, and (3) total stockholders' equity c. Determine the following amounts after the stock dividend was declared and closing entries were recorded at the end of the year: (1) total paid- in capital, (2) total retained earnings, and (3) total stockholders'equity.
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Transcribed Image Text:Instructions Advanced Life Co. is an HMO for businesses in the Albuquerque area. The following account balances appear on the balance sheet of Advanced Life Co.: Common stock (600,000 shares authorized; 400,000 shares issued), S8 par. $3,200,000; Paid-in capital in excess of par-common stock, S800,000; and Retained earnings, $25,600,000. The board of directors declared a 2% stock dividend when the market price of the stock was $19 a share. Advanced Life Co. reported no income or loss for the current year. Required: a. Journalize the entries to record (1) the declaration of the dividend on December 1, capitalizing an amount equal to market value, and (2) the issuance of the stock certificates on December 31. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered. b. Determine the following amounts before the stock dividend was declared: (1) total paid-in capital, (2) total retained earnings, and (3) total stockholders' equity c. Determine the following amounts after the stock dividend was declared and closing entries were recorded at the end of the year: (1) total paid- in capital, (2) total retained earnings, and (3) total stockholders'equity.
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