Question

1. XYZ Corporation reported the following selected amounts on its comparative balance sheet:

Current Assets     2019     2020
Trading Securities $9,000 $5000
Available-for-Sale Securities $28,000 $14,000

Current Liabilities
Dividends Payable $35,021 $20,604
Accounts Payable $30,000 $52,000

Stockholders' Equity
Common Stock ($1 par) $53,262 $148,462
Paid-in Capital in Excess of Par $150,441 $203,135
Paid-in Capital - Share Repurchase $9,555 $12,166
Retained Earnings $315,000 $400,000
Accumulated Other Comprehensive Income:
Unrealized Gain on Available-for-Sale Securities $32,340 $50,605

The 2020 income statement of XYZ Corporation reports:

Net Income $241,681
Gain on the Sale of Available-for-Sale Securities $7,588

Additional Information:

During 2020, XYZ Corporation retired 1,000 shares of its common stock. These shares were originally issued for $10 per share. No other stock was retired.

There were no treasury stock transactions and no stock dividends during 2020. All issuances of common stock were in exchange for cash.

Required: Determine the amount to be reported on the 2020 Statement of Cash Flows as "Cash Dividends Paid".

Answer 1

Particulars	Amount
Beginning retained earnings	315000
Add: net income	241681
Less: Ending retained earnings	$      (400,000)
Dividends declared	$        156,681
Add: beginning dividends payable	$          35,021
Less: ending dividends payable	$         (20,064)
Dividends paid	$        171,638

Cash Dividends Paid is $171,638

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