Purchase Solution

Dividends and Stockholders' Equity Section

Not what you're looking for?

Ask Custom Question

Elizabeth Company reported the following amounts in the stockholders' equity section of its December 31, 2010, balance sheet.

Preferred Stock, 8%, $100 par (10,000 shares authorized, 2,000 shares issued) $200,000
Common Stock, $5 par (100,000 shares authorized, 20,000 shares issued) $100,000
Additional paid-in capital $125,000
Retained Earnings $450,000
Total $875,000

During 2011, Elizabeth took part in the following transactions concerning stockholders' equity.
1. Paid the annual 2010 $8 per share dividend on preferred stock and a $2 per share dividend on common stock. These dividends had been declared on December 31, 2010.
2. Purchased 2,700 shares of its own outstanding common stock for $40 per share. Elizabeth uses the cost method.
3. Reissued 700 treasury shares for land valued at $30,000.
4. Issued 500 shares of preferred stock at $105 per share.
5. Declared a 10% stock dividend on the outstanding common stock when the stock is selling for $45 per share.
6. Issued the stock dividend.
7. Declared the annual 2011 $8 per share dividend on preferred stock and the $2 per share dividend on common stock. These dividends are payable in 2012

Instructions
(a) Prepare journal entries to record the transactions described above.
(b) Prepare the December 31, 2011, stockholders' equity section. Assume 2011 net income was $330,000.

Purchase this Solution
Solution Summary

The solution discusses the dividends and stockholder's equity section to prepare journal entries and record transactions.

Purchase this Solution
Free BrainMass Quizzes
Understanding Management

This quiz will help you understand the dimensions of employee diversity as well as how to manage a culturally diverse workforce.

SWOT

This quiz will test your understanding of the SWOT analysis, including terms, concepts, uses, advantages, and process.

Organizational Leadership Quiz

This quiz prepares a person to do well when it comes to studying organizational leadership in their studies.

Basics of corporate finance

These questions will test you on your knowledge of finance.

Social Media: Pinterest

This quiz introduces basic concepts of Pinterest social media

View More Free Quizzes
Related BrainMass Solutions

  • Anne Cleves Company

    97822 Dividends and Stockholders' Equity Section Dividends and Stockholders' Equity Section E15-18 (Dividends and Stockholders' Equity Section) Anne Cleves Company reported the following amounts in the stockholders' equity section of its December 31

  • Anne Cleves Company Equity Section

    98925 E15-18 (Dividends and Stockholders' Equity Section) Anne Cleves Company reported the following amounts in the stockholders' equity of its December 31, 2006, balance sheet.

  • Lewis Company

    224652 Corrected stockholders' equity section of the balance sheet Preparation of corrected stockholders' equity section of the balance sheet. On December 31, Lewis Company prepared the following stockholders' equity section of its balance sheet.

  • Dividends and Stockholders' Equity

    97523 Dividends and Stockholders' Equity (Dividends and Stockholders' Equity Section) Anne Cleves Company reported the following amounts in the stockholders' equity section of its December 31, 2006, balance sheet.

  • The answer to Stockholders equity transactions

    stockholders equity section incorporating all the above information 1) A total cash dividend of 90,000 was declared and payable to stockholders of record.

  • Dividends, Stock Splits, and Stockholder's Equity

    264726 Dividends and Stock Split Transactions and Stockholder's Equity The stockholder's equity section of Rigby Moving and Storage Company's balance sheet as of December 31, 20x7 is shown below.

  • Parallel Consulting Ltd

    b) If Parallel Consulting had net income of $250,000 and paid cash dividends of $75,000 during the year, prepare the shareholders' equity section of the company's balance sheet as at 31 December 2006.

  • Stockholders' equity section of the balance sheet

    374734 Stockholders' equity section of the balance sheet The corporate charter authorizes the issuance if 108,000 shares of preferred stock at $ 50 par, and 1,920,000 shares of $4 par common stock.

  • various types of equity accounts

    Reference: http://www.accountingcrosswords.com/stockholders-equity.php It is also to be noted that a corporation can have common stock and preferred stock in the stockholder's equity section.

View More Related Solutions