F7 Flashcards
Hope Corps current balance sheet reports the following stockholders’ equity
Preferred stock. 250,000
Common stock. 350,000
Additional paid - in cap 125,000
Retained Earnings. 300,000
Dividends in arrears on the preferred stock amount to $25,000. If Hope were to be liquidated, the preferred stockholders were receive par value plus a premium of $50k. The book value per share of common stock is:
- 7.50
- 7.25
- 7.00
- 7.75
- 7.00
250 + 350 + 125 + 300 = 1,025 - 325* =
700 /100 (OS) = 7.00
- 250 + 50 + 25 = 325* any preferred shareholder I Tereso must be removed from shareholders’ equity before computing book value per share.
On March 1 Ryan Corp. issued 1000 shares of its $20 par value come and start in 2000 shares of us $20 par value convertible preferred stock for a total of $80,000. At this date, Ryan’s common stock was selling for $36 per share, the convertible preferred stock was selling at $27 per share. What amount of the proceeds should be allocated to Ryan’s convertible preferred stock?
- 48,000
- 44,000
- 60,000
- 54,000
- 48,000
Common Stock : 1000 x 36 = 36k. 32k
Preferred Stock: 2000 x 27 = 54k. 48k
Allocate to preferred: 54/90 x 80k = 48k
Each of the following transactions will cause a decrease in stockholders equity, except:
- The declaration of a cash dividend
- The sale of treasury stock at less than cost
- A loss on the sale of a discontinued segment
- A loss from a foreign currency translation adjustment
- The sale of treasury stock at less than cost
(this option will result in an increase in stockholders equity. The original cost of the treasury stock is credited any additional paid in capital treasury stock is debited and any access over the paid in capital would reduce retained earnings however, the net impact of stockholders equity will still be positive as long as cash is received from the sale of the treasury stock.
Division corporation has 20,000 shares of five dollar participating 9% cumulative preferred stock and 100,000 shares of two dollars common. On July 1, the board of division declared a $30,000 dividends at the time the common stock was selling for $25 per share in the preferred stock for selling for $30. The total dividends paid to each class of stock on the payment date was:
Preferred: Common:
16k. 14k
9. 5k. 20k
12. 5k. 17.5k
10k. 20k
10k. 20k
30k
20k 100k
5. 2
100k. 200k. 300k
9%. 9%
9k. 18k. 27k
33.3%. 66.6%
1k. 2k. 3k
10k. 20k. 30k
Grip corporation acquire some of its own common shares at a price greater than both their par value and original issue price but less than their book value. Grip uses the common method of accounting for a treasury stock. What is the impact of this acquisition on total stockholders equity and the book value per come this year?
Total stockholders. Book value
equity. per share
Decrease Decrease
Increase. Decrease
Increase. Increase
Decrease. Increase
Decrease. Increase
Revenue - Expenses = Pre tax income - Tax expense = net income + Beg RE =
Ending RE
Book value per common share =
Common stockholders equity / common shares outstanding
Common stock is reported on the balance sheet as the total shares issued at………… Value
Par value
And December 31, your two, and your three, Apex had 3000 shares of $100 par, 5% cumulative preferred stock outstanding. No dividends were in arrears as of December 31, you’re one. Apex did not declare a dividend rate you’re too. During your three, Apex payday cash of $10,000 from his preferred stock report dividends in arrears and it’s your financial statements as a?
- Accrued liability of $20k
- Disclosure of $15k
- Accrued liability of $20k
- Disclosure of $20k
- Disclosure of $20k
For year 2 3000 x $100 par x 5% = $15k
For year 2. $15k
$30k Less amount paid during Year 3. ($10k)
Disclosure of dividends in arrea 20k
When it comes to the deferred tax asset balances at year end, one must us the …………… amount times the tax rate
Future deductible amount times the tax rate
