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PR 13-A dividens on perferred and common stock...




PR 13-A dividens on perferred and common stock obj.3 1.common dividens in 2007 is $8000 Bridger Bike Corp. manufactures mountain bikes and distributes them through retail outlets in Montana, Idaho,Oregon,and Washington. Bridger Bike Corp. has declared the following annual divideneds over a six-year period ending December 31 of each year:2005,$5000;2006,$18000;2007,$45000;2008,45000;2009,$60000; and 2010,67000.During the entire period , the outstanding stock of the company was composed of $10000 shares of 2% cumulative perferred stock,$100 par, and $25000 shares of common stock, $1 par. Instructions: 1. Determine the total dividends and the per-share dividends declared on each of the six years. There were no dividends in arrears on January 1, 2005. Summerize the data in tabular form, using the followingcolumn headings: year totaldividends perferreddividends commondividends _-------------------------------------------------------- total per share total pershare 2005 $5000 2006 $18000 2007 $45000 2008 $45000 2009 $60000 2010 $67000 2.Determine the average annual dividends per share for each class of stock for the six-year period. 3.Assuming a market price of $125 for the perferred stock and $8 for for the common stock,calculate the average annual percentage return on inital shareholders' investment, based on the average annual dividend per share (a) for preferrred stock and (b) for common stock. PR-13-2A Stock transaction for corporate expansion obj.3 Sheldon Optics produces medical lasers for use in hospitals. The accounts and their balances appear in the ledger of sheldon Optics on October 31 of the current year as follows: perferred 2% stock,$80 par (50000 shares authorized,25000 shares issued)........... $2,000,000 Paid-in capital in excess of par- perferred stock......75,000 common stock, $100 par (500,000 shares authorized, 50,000 shares issued.........5,000,000 paid-in capital in excess of par-common stock....600,000 retained earnings........................... 16,750,000 At the annual stockholders meeting on december 7 the board od directors presented a plan for modernizing and expanding plant operations at a cost of approximately $5,300,000. The plan provided (a) that the corporation borrow $2,000,000, (b) that 15,000 shares of the unissued perferred stock be issued through an underwriter, and (c) that a building, valued at $1,850,000, and the land on which it is located, valued at $162,500 shares of common stock. The plan was approved by the stockholders and accomplished by the following transactions: Jan. 10.Borrowed $2,000,000 from Whitefish National Bank, giving a 7% mortgage note. 21.Issued 15,000 shares of perferred stock, recieving $84.50 per share in cash. 31. Issued 17,500 shares of common stock in exchange for land and a building, according to the plan. No other instructions occured during January. Instructions Journalize the entries to record the foregoing transactions.


Paper#11373 | Written in 18-Jul-2015

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