On January 1, Guillen Corporation had 95,000 shares of no-par
common stock issued and outstanding. The stock has a stated value
of $5 per share. During the year, the following occurred.
|Apr.||1||Issued 25,000 additional shares of common stock for $17 per share.|
|June||15||Declared a cash dividend of $1 per share to stockholders of record on June 30.|
|July||10||Paid the $1 cash dividend.|
|Dec.||1||Issued 2,000 additional shares of common stock for $19 per share.|
|15||Declared a cash dividend on outstanding shares of $1.2 per
share to stockholders of record on December 31.
How are dividends and dividends payable reported in the financial statements prepared at December 31?
|Shares outstanding at June 30||120000||=95000+25000|
|X Dividend per share||1|
|Dividends paid on July 10||120000|
|Shares outstanding at December 31||122000||=95000+25000+2000|
|X Dividend per share||1.2|
|Dividends payable at December 31||146400|
|Total dividends declared||266400||=120000+146400|
|In the Retained Earnings Statement, dividends of $266400 will be deducted|
|In the Balance Sheet, Dividends payable of $146400 will be reported as a Current liability|
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