Hise Inc., has 4,000 shares of 9%, $100 par value, cumulative preferred stock and 200,000 shares of $1 par value common stock outstanding at December 31, 2014, and December 31, 2013. The board of directors declared and paid a $25,000 dividend in 2013. In 2014, $74,000 of dividends are declared and paid. What are the dividends received by the preferred stockholders in 2014?
A. $11,000
B. $36,000
C. $47,000
D. $74,000
McCaffrey Corporation owned 15,000 shares of Harper Corporation's $5 par value common stock. These shares were purchased in 2010 for $326,000. On May 4, 2014, McCaffrey declared a property dividend of one share of Harper for every twenty shares of McCaffrey stock held by a stockholder. On that date, when the market price of Harper was $34 per share, there were 280,000 shares of McCaffrey outstanding. What net reduction in retained earnings would result from this property dividend?
A. $150,000
B. $176,000
C. $326,000
D. $476,000
On October 31, 2014, Lexington Corp. declared and issued a 12% common stock dividend. Prior to this dividend, Lexington had 302,000 shares of $.001 par value common stock issued and outstanding. The fair value of Lexington's common stock was $16.75 per share on October 31, 2014. As a result of this stock dividend, the company's total stockholders' equity
A. increased by
$302,000.
B. decreased by $5,058,198.
C. decreased by $5,058,500.
D. did not change.
Terpsichore Inc., has 1,000 shares of 5%, $100 par value, cumulative preferred stock and 200,000 shares of $1 par value common stock outstanding at December 31, 2014, and December 31, 2013. No dividends were paid in 2013. In 2014, $75,000 of dividends are declared and paid. If the preferred stock is nonparticipating, what are the dividends received by the preferred stockholders in 2014?
A. $5,000.
B. $10,000.
C. $42,500.
D. $65,000.
On April 1, Year 1, Jetter Corporation reacquired 2,000 shares of its own $10 par stock for $120,000 cash. On October 15, Year 1, 600 of the treasury shares were reissued at a price of $65 per share.
Assuming there are no further transactions involving treasury stock in Year 1, the financial statements of Jetter Corporation for Year 1 will show:
A] Treasury Stock of $81,000 among the assets in the balance sheet.
B] Gain on Sale of Treasury Stock of $3,000 in the income statement for Year 1.
C] Treasury Stock of $120,000 as a deduction in the stockholders' equity section of the December 31, Year 1, balance sheet.
D] Additional Paid-In Capital: Treasury Stock Transactions of $3,000 in the December 31, Year 1 balance sheet.
On April 1, Year 1, Jetter Corporation reacquired 2,000 shares of its own $10 par stock for $120,000 cash. On October 15, Year 1, 600 of the treasury shares were reissued at a price of $65 per share.
The reacquisition of the 2,000 shares on April 1, Year 1, causes:
A] No change in total assets of Jetter Corporation.
B] No change in the number of shares of Jetter Corporation stock outstanding.
C] A reduction in total assets and in total stockholders' equity of Jetter Corporation.
D] Jetter Corporation to show a new asset, "Treasury Stock", for $120,000.
On January 1, Year 1, Juniper Corporation issued 60,000 shares of its total 200,000 authorized shares of $4 par value common stock for $8 per share. On December 31, Year 1, Juniper Corporation's common stock is trading at $12 per share.
Assume Juniper Corporation decides to issue an additional 1,000 shares of its common stock on December 31, Year 1. How will the above increase in value affect Juniper?
A] Juniper can issue the 1,000 shares at a higher price than the initial 60,000 shares.
B] Juniper can sell the 1,000 shares for $12 each, as well as collect an additional $4 per share for each of the 60,000 shares sold initially.
C] Juniper reports a gain of $4 per share on all stock sold during the year.
D] Paid-in capital at the end of Year 1 will be $732,000 [i.e., 61,000 shares times $12 per share].
Century Corporation issued 400,000 shares of $4 par value common stock at the time of its incorporation. The stock was issued for cash at a price of $16 per share. During the first year of operations, the company sustained a net loss of $100,000. The year-end balance sheet would show the balance of the Common Stock account to be:
A] $1,600,000.
B] $1,500,000.
C] $6,300,000.
D] $6,400,000.
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