Accounting Stock Transactions Exercises

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Questions and Answers

What was the return on stockholders' equity ratio for Manning Company in 2016?

12% (correct)

15%

10%

Why would net income increase while the return on common stockholders' equity decreased for Hampton Corporation?

Increase in total revenue

Decrease in stockholders' equity (correct)

Reduction in total assets

Increase in liabilities

What is the debt to total assets ratio for Manning Company in 2017 post-debt issuance?

50% (correct)

30%

40%

20%

What effect would the repurchase of shares have on Manning Company's return on equity?

Increase due to reduced equity Signup and view all the answers

How would you describe Manning Company's solvency position based on the changes in its liabilities and equity?

Worsened as liabilities increased beyond equity Signup and view all the answers

What will be the new total stockholders’ equity after Kalen Corporation distributes a 15% stock dividend?

$1,048,000 Signup and view all the answers

How does the payout ratio for Epstein Corporation change from 2016 to 2017?

It decreased. Signup and view all the answers

What is the calculation for the return on common stockholders’ equity for Epstein Corporation in 2017?

20% Signup and view all the answers

What was the amount received in cash when Miles Co. issued 60,000 shares of common stock?

$250,000 Signup and view all the answers

What is the preferred stock's par value for the shares issued by Miles Co.?

$100 Signup and view all the answers

What is the total amount paid by Browning Corporation in cash dividends during the year?

$120,000 Signup and view all the answers

How much treasury stock did Miles Co. purchase?

$10,000 Signup and view all the answers

What is the significance of the $10 par value in Kalen Corporation's stock equity?

It represents the legal capital per share. Signup and view all the answers

What was the cash dividend declared per share by Giraldi Corporation on June 30, 2017?

$1.50 Signup and view all the answers

How many shares were outstanding after the 10% stock dividend declared on June 30, 2017?

66,000 Signup and view all the answers

What is the fair market value of Giraldi Corporation's stock on June 30, 2017?

$16 Signup and view all the answers

What was the par value of the stock after the 2 for 1 stock split declared on December 1, 2017?

$5 Signup and view all the answers

What amount would appear under common stock in the stockholders’ equity section after the adjustments due to stock dividend and stock split?

$600,000 Signup and view all the answers

What was the retained earnings amount for Giraldi Corporation at December 31, 2016?

$150,000 Signup and view all the answers

What were the total stockholders' equity for Giraldi Corporation at December 31, 2016?

$912,500 Signup and view all the answers

How many shares did Giraldi Corporation issue on December 1, 2017?

4,000 Signup and view all the answers

What was the issuance price per share for the common stock of Black Corporation on July 1, 2017?

$15 Signup and view all the answers

How many shares of preferred stock were issued and outstanding by Fleming Corporation at the end of 2016?

10,000 shares Signup and view all the answers

What was the total par value of the common stock outstanding for Black Corporation on January 1, 2017?

$2,000,000 Signup and view all the answers

What is the market value of Black Corporation stock on December 31, 2017?

$16 per share Signup and view all the answers

What is the total amount of common stock issued by Bradley, Inc.?

$500,000 Signup and view all the answers

When was the dividend on common stock of Fleming Corporation declared?

November 1, 2017 Signup and view all the answers

How much is the paid-in capital in excess of par value for common stock at Bradley, Inc.?

$950,000 Signup and view all the answers

What amount of dividends was declared for preferred stock on September 15, 2017, by Fleming Corporation?

$0 Signup and view all the answers

What will be the dividends payable on December 15, 2017 if a stock dividend of 10% was declared?

$1,200,000 Signup and view all the answers

What is the total stockholders' equity for Bradley, Inc. at December 31, 2017?

$2,730,000 Signup and view all the answers

What was the par value of the common stock of Fleming Corporation?

$10 Signup and view all the answers

What amount is restricted for plant expansion from retained earnings at Bradley, Inc.?

$200,000 Signup and view all the answers

What is the stated value of common stock for Marvel Corporation?

$5 per share Signup and view all the answers

What is the total amount of treasury stock for Marvel Corporation?

$98,000 Signup and view all the answers

What is the total value of retained earnings for Marvel Corporation at December 31, 2017?

$1,634,000 Signup and view all the answers

How much is the paid-in capital in excess of stated value for common stock at Marvel Corporation?

$1,050,000 Signup and view all the answers

What is the total amount in cash on the balance sheet as of December 31, 2014?

$24,600 Signup and view all the answers

What amount did Hampton collect from customers on account during 2015?

$276,000 Signup and view all the answers

How much preferred stock was issued by Hampton on January 1, 2015?

$49,200 Signup and view all the answers

What is the balance of accounts payable as of December 31, 2015?

$27,400 Signup and view all the answers

What amount was declared as dividends for common stock?

$1.20 per share Signup and view all the answers

What is the balance of the Allowance for Doubtful Accounts at year-end 2015?

$3,500 Signup and view all the answers

What is the total revenue earned from services performed on account in 2015?

$320,000 Signup and view all the answers

What was the total operating expense paid by Hampton during 2015?

$188,200 Signup and view all the answers

Study Notes

Brief Exercises

Patrick Corporation is authorized to issue 1,000,000 shares of $1 par value common stock.
In 2016, the company had various stock transactions.
January 15: Issued 600,000 shares at $7 per share.
September 5: Purchased 20,000 treasury shares at $8 per share.
December 6: Declared a $0.50 per share dividend payable January 3, 2017.

Be. 216

An inexperienced accountant made entries for Teahan Corporation.
July 1: Cash 170,000; Common Stock 170,000 (Issued 20,000 shares of no-par common stock, stated value $6 per share)
September 1: Common Stock 36,000; Retained Earnings 24,000; Cash 60,000 (Purchased 4,000 shares issued on July 1 for the treasury at $15 per share)

Be. 218

Samson Company had transactions:
- Issued 4,000 shares of $100 par preferred stock at $107 per share.
- Issued 8,000 shares of common stock with $10 par value for $110,000.
- Purchased 500 shares of treasury common stock for $12,000.

Be. 221

Lindy Corporation has 1,000,000 authorized shares of $20 par value common stock.
As of June 30, 2017, 600,000 shares were issued and outstanding.
On June 30, 2017, a $0.30 per share cash dividend was declared, payable on August 1, 2017.

Be. 222

Kalen Corporation's stockholders' equity on November 1, 2017:
- Common stock, $10 par value: $600,000
- Paid-in capital in excess of par value: $180,000
- Retained earnings: $200,000
- Total stockholders' equity: $980,000
On November 1, 2017, a 15% stock dividend was declared. Market value was $14 per share.

Be. 224

Epstein Corporation's data for 2017 and 2016:
- Average common stockholders' equity: $1,500,000 and $1,000,000 for 2017 and 2016 respectively
- Average total stockholders' equity: $2,000,000 each year
- Common dividends declared and paid: $72,000 and $50,000
- Preferred dividends declared and paid: $30,000 and $30,000
- Net income: $240,000 and $200,000

Ex. 227

Miles Co. transactions:
- June 12: Issued 60,000 shares of $3 stated value common stock for $250,000 cash.
- July 11: Issued 2,000 shares of $100 par value preferred stock for $106 per share.
- November 28: Purchased 2,000 shares of treasury stock for $10,000.

Ex. 228

Browning Corporation transactions:
- January 1, 2017: 75,000 shares of $1 par value common stock issued and outstanding.
- March 1: Issued 60,000 shares of common stock for $675,000.
- June 1: Declared a $2.00 per share cash dividend (June 15).
- June 30: Paid the $2.00 cash dividend.
- December 1: Purchased 5,000 shares of common stock in treasury for $18 per share.
- December 15: Declared a $2.50 cash dividend.
- December 31: Paid the $2.50 cash dividend
- 2017 net income amounted to $951,000.

Ex. 230

Patrick Corporation's stockholders' equity at December 31:
- Preferred stock, 6,000 shares issued (cumulative): $300,000
- Common stock, 600,000 shares issued: $3,000,000
- Retained earnings: $1,358,000; Treasury Stock (6,000 shares): ($32,000)
- Total stockholders' equity: $4,626,000

... (and so on for the remaining exercises)

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Description

Test your knowledge of stock transactions and accounting entries with these brief exercises. Learn how to manage common stock issuance, treasury stock purchases, and dividend declarations for various companies.