ACCOUNTING Problem 1 The outstanding capital stock of

ACCOUNTING Problem 1 The outstanding capital stock of Manners Corporation consisted of 4,000 shares of 10 percent preferred stock, $200 par value, and 40,000 shares of no-par common stock with a stated value of $200. The preferred was issued at $445, the
common at $510 per share. On January 1, 20x5, the retained earnings of the company were $330,000. During the succeeding five years, net income was as follows: 2005 $740,500 2006 470,000 2007 53,000 2008 180,000 2009 638,500 No dividends were in arrears as
of January 1, 20x5, and during the five years 20x5-20x9, the board of directors declared dividends in each year equal to net income of the year. Prepare a schedule showing the dividends declared each year on each class of stock assuming the preferred stock
is: a. Cumulative. b. Noncumulative. Problem 2 On May 1, 20x9, Hammon Company received a charter that authorized it to issue: • 4,000 shares of no-par preferred stock to which a stated value of $12 per share is assigned. The stock is entitled to a cumulative
dividend of $ 9.60, convertible into two shares of common stock, callable at $ 208, and entitled to $ 200 per share in liquidation. • 1,500 shares of $ 400 par value, $ 20 cumulative preferred stock, which is callable at $ 420 and entitled to $ 412 in liquidation.
• 60,000 shares of no-par common stock to which a stated value of $ 40 is assigned. May 1 All of the $ 9.60 cumulative preferred was issued at $ 204 per share, cash. 2 All of the $ 20 cumulative preferred was exchanged for merchandise inventory, land, and
buildings valued at $ 128,000, $ 160,000, and $ 425,000, respectively. 3 Cash of $ 15,000 was paid to reimburse promoters for costs incurred for accounting, legal, and printing services. In addition, 1,000 shares of common stock were issued to the promoters
for their services. The value of all of the services (including those paid in cash) was $ 55,000. a. Prepare journal entries for these transactions. b. Assume that retained earnings were $ 200,000. Prepare the stockholders' equity section of the May 31, 20x9,
balance sheet. Problem 3 The common stock of Bishop Corporation is selling on a stock exchange for $ 90 per share. The stockholders' equity of the corporation at December 31, 20x9 consists of: Stockholders' equity: Paid-in capital: Preferred stock—9% cumulative,
$120 par value, $120 liquidation value, 3,000 shares authorized, issued, and outstanding $360,000 Common stock—$72 par value, 30,000 shares authorized, issued and outstanding 2,160,000 Total paid-in capital 2,520,000 Retained earnings 354,000 Total stockholders'
equity 2,874,000 Assume that in liquidation the preferred stock is entitled to par value plus cumulative unpaid dividends. a. What is the total market value of all of the corporation's common stock? b. If all dividends have been paid on the preferred stock
as of December 31, 20x9, what are the book values of the preferred stock and the common stock? c. If two years' dividends were due on the preferred stock as of December 31, 20x9, what are the book values of the preferred stock and common stock? Problem 4 The
December 31, 20x9, trial balance of Clancy Corporation had the following account balances: Common stock (no-par value; 200,000 shares authorized, issued, and outstanding; stated value of $20 per share) 4,000,000 Notes payable (12% due 2010 May 1) 500,000 Retained
earnings, unappropriated 2,500,000 Dividends payable in cash (declared December 15, on preferred stock) 12,000 Appropriation per loan agreement 480,000 Preferred stock (6%, par value $200; 2,000 shares authorized, issued, and outstanding) 400,000 Paid-In capital
in excess of stated value – Common 300,000 Paid-In Capital in Excess of Par Value – Preferred 40,000 Present in proper form the stockholders' equity section of the balance sheet. Problem 5 The stockholders' equity section of McCollough Company's balance sheet
on December 31, 20x4, shows 100,000 shares of authorized and issued $ 20 stated value common stock, of which 9,000 shares are held in the treasury. On this date, the board of directors declared a cash dividend of $2 per share payable on January 21, 20x5, to
stockholders of record on January 10. Give dated journal entries for these.