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##### acct 212 exam 1

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Question;acct 212 exam 1;award:3 out of;3.00 points;Exercise 13-2 Accounting for par, stated, and no-par stock issuances;L.O. P1;Aloha;Corporation issues 10,000 shares of its common stock for \$134,200 cash on;February 20.;1.;Assume;the stock has neither par nor stated value. Prepare journal entries to record;this event. (Omit the "\$" sign in;your response.);2.;Assume;the stock has a \$12 par value. Prepare journal entries to record this;event. (Omit the "\$" sign in your;response.);3.;Assume;the stock has an \$6.0 stated value. Prepare journal entries to record this;event. (Omit the "\$" sign in your;response.);Worksheet;Exercise 13-2 Accounting for par, stated, and no-par stock issuances;L.O. P1;2.;award:3 out of;3.00 points;Exercise 13-4 Stock issuance for noncash assets L.O. P1;Soku;Company issues 18,000 shares of \$9 par value common stock in exchange for land;and a building. The land is valued at \$238,000 and the building at \$365,000.;Prepare;the journal entry to record issuance of the stock in exchange for the land;and building. (Omit the "\$" sign in;your response.);Worksheet;Exercise 13-4 Stock issuance for noncash assets L.O. P1;3.;award:2.50 out of;3.00 points;Exercise 13-6 Stock dividends and splits L.O. P2;On June 30, 2011, Quinn Corporation?s common stock is priced at \$26.0;per share before any stock dividend or split, and the stockholders? equity;section of its balance sheet appears as follows.;Common stock?\$6 par value, 90,000 shares authorized;36,000 shares issued and outstanding;\$;216,000;Paid-in capital in excess of par value, common stock;100,000;Retained earnings;316,000;Total stockholders? equity;\$;632,000;Assume that the company declares and;immediately distributes a 100% stock dividend. This event is recorded by;capitalizing retained earnings equal to the stock?s par value. Answer these;questions about stockholders? equity as it exists after issuing;the new shares.;1a.;What is the retained earnings balance?(Omit the;\$" sign in your response.);1b.;What is the amount of total stockholders? equity?(Omit the;\$" sign in your response.);1c.;How many shares are outstanding?;Assume that the company implements a;2-for-1 stock split instead of the stock dividend in part 1. Answer these;questions about stockholders? equity as it exists after issuing;the new shares.;2a.;What is the retained earnings balance?(Omit the;\$" sign in your response.);2b.;What is the amount of total stockholders? equity?(Omit the;\$" sign in your response.);2c.;How many shares are outstanding?;4;award:3 out of;3.00 points;Exercise 13-8 Dividends on common and noncumulative preferred stock L.O.;C2;Wade?s;outstanding stock consists of 45,000 shares of noncumulative 8.40%;preferred stock with a \$10 par value and also 112,500 shares of common stock;with a \$1 par value. During its first four years of operation, the;corporation declared and paid the following total cash dividends.;2011;\$;30,000;2012;22,000;2013;100,000;2014;197,000;Determine;the amount of dividends paid each year to each of the two classes of;stockholders. (Leave no cells blank - be;certain to enter "0" wherever required. Omit the "\$" sign;in your response.);Compute;the total dividends paid to each class for the four years combined. (Omit the "\$" sign in your response.);Worksheet;Exercise 13-8 Dividends on common and noncumulative preferred stock;L.O. C2;5.;award:3 out of;3.00 points;Exercise 13-9 Dividends on common and cumulative preferred stock L.O. C2;Wade?s;outstanding stock consists of 48,000 shares of cumulative 7.00%;preferred stock with a \$10 par value and also 120,000 shares of common stock;with a \$1 par value. During its first four years of operation, the;corporation declared and paid the following total cash dividends.;2011;\$;27,000;2012;28,725;2013;66,100;2014;98,600;Determine;the amount of dividends paid each year to each of the two classes of;stockholders. (Leave no cells blank - be;certain to enter "0" wherever required. Omit the "\$" sign;in your response.);Determine;the total dividends paid to each class for the four years combined. (Omit the "\$" sign in your response.);Worksheet;Exercise 13-9 Dividends on common and cumulative preferred stock L.O.;C2;6.;award:3 out of;3.00 points;Exercise 13-11 Preparing a statement of retained earnings L.O. C3;The;following information is available for Ballard Company for the year ended;December 31, 2011.;a.;Balance;of retained earnings, December 31, 2010, prior to discovery of error;\$860,000.;b.;Cash;dividends declared and paid during 2011, \$27,000.;c.;It;neglected to record 2009 depreciation expense of \$39,600, which is net of;\$5,600 in income taxes.;d.;The;company earned \$210,000 in 2011 net income.;Prepare a 2011 statement of retained earnings for;Ballard Company. (Amounts to be deducted;should be indicated with a minus sign. Omit the "\$" sign in your;response.);Worksheet;Exercise 13-11 Preparing a statement of retained earnings L.O. C3;7.;award:3 out of;3.00 points;Exercise 13-12 Earnings per share L.O. A1;Guess Company reports \$1,325,000 of net income for 2011 and declares;\$185,500 of cash dividends on its preferred stock for 2011. At the end of;2011, the company had 390,000 weighted-average shares of common stock.;1.;What amount of net income is available to common stockholders for;2011?(Omit the "\$" sign in your response.);2.;What is the company?s basic EPS for 2011?(Round your answer to;2 decimal places. Omit the "\$" sign in your response.);8.;award:3 out of;3.00 points;Exercise 13-13 Earnings per share L.O. A1;Franklin;Company reports \$1,475,000 of net income for 2011 and declares \$206,500 of;cash dividends on its preferred stock for 2011. At the end of 2011, the;company had 250,000 weighted-average shares of common stock.;1.;What;amount of net income is available to common stockholders for 2011? (Omit the "\$" sign in your response.);2.;What is;the company?s basic EPS for 2011? (Round your;answer to 2 decimal places. Omit the "\$" sign in your response.);Worksheet;9.;award:2.40 out of;3.00 points;Exercise 13-14 Dividend yield computation and interpretation L.O. A3;Company;Annual Cash;Dividend per Share;Market Value;per Share;1;\$;13.00;\$;173.33;2;10.00;107.53;3;11.90;120.20;4;1.90;127.60;Compute;the dividend yield for each of these four separate companies. (Round your answers to 1 decimal place. Omit the;%" sign in your response.);Which;company?s stock would probably not be classified as an;income stock?;10.;award:3 out of;3.00 points;Exercise 13-15 Price-earnings ratio computation and interpretation L.O.;A2;Company;Earnings;per Share;Market Value;per Share;1;\$;10.00;\$;160.00;2;8.00;81.60;3;6.00;79.20;4;43.00;301.00;Compute;the price-earnings ratio for each of these four separate companies. (Round your answers to 1 decimal place.);Which;stock might an analyst likely investigate as being potentially undervalued by;the market?;Company 4;Worksheet;Exercise 13-15 Price-earnings ratio computation and interpretation;L.O. A2;12.;award:2.70 out of;3.00 points;Exercise 13-17 Accounting for equity under IFRS L.O. C3, P1;Unilever;Group reports the following equity information for the years ended December;31, 2007 and 2008 (euros in millions).;December;31;2008;2007;Share;capital;?;488;?;488;Share;premium;126;167;Other;reserves;(6,459;(3,415;Retained;profit;15,813;15,175;Shareholders?;equity;?;9,968;?;12,415;1.;Match;each of the three account titles share capital, share premium, and retained;profit with the usual account title applied under U.S. GAAP.;2.;Prepare;Unilever?s journal entry, using its account titles, to record the issuance of;capital stock assuming that its entire par value stock was issued on December;31, 2007, for cash. (Enter answers in;millions of euros and not in whole euros. Omit;the "?" sign in your response.);3.;What;were Unilever?s 2008 dividends assuming that only dividends and income;impacted retained profit for 2008 and that its 2008 income totaled;?2,681? (Enter answers in millions of euros;and not in whole euros. Omit the;?" sign in your response.);13.;award:2.40 out of;3.00 points;Exercise 14-1 Recording bond issuance and interest L.O. P1;On;January 1, 2011, Kidman Enterprises issues bonds that have a \$1,600,000 par;value, mature in 20 years, and pay 8% interest semiannually on June 30 and;December 31. The bonds are sold at par.;1.;How;much interest will Kidman pay (in cash) to the bondholders every six;months? (Do not round intermediate;calculations. Omit the "\$" sign in your response.);Semiannual;cash interest payment;\$ 3,200;2.;Prepare;journal entries for the following.;(a);The;issuance of bonds on January 1, 2011. (Omit;the "\$" sign in your response.);(b);The;first interest payment on June 30, 2011. (Do;not round intermediate calculations. Omit;the "\$" sign in your response.);(c);The;second interest payment on December 31, 2011. (Do not round intermediate calculations. Omit the "\$" sign in your response.);General Journal;Debit;Credit;Bond;interest expense;3,200;Cash;3,200;3.;Prepare;the journal entry for issuance of bonds assuming.;(a);The;bonds are issued at 98. (Omit the;\$" sign in your response.);(b);The;bonds are issued at 102. (Omit the;\$" sign in your response.);Worksheet;Exercise 14-1 Recording bond issuance and interest L.O. P1;Worksheet;Exercise 13-17 Accounting for equity under IFRS L.O. C3, P1;14.;award:2 out of;3.00 points;Exercise 14-6 Recording bond issuance and premium amortization L.O. P1;P3;Jobbs;Company issues 6%, five-year bonds, on December 31, 2010, with a par value of;\$98,000 and semiannual interest payments.;Semiannual Period-End;Unamortized Premium;Carrying Value;(0);12/31/2010;\$;8,071;\$;106,071;(1);6/30/2011;7,264;105,264;(2);12/31/2011;6,457;104,457;Use the;above straight-line bond amortization table and prepare journal entries for;the following.;(a);The;issuance of bonds on December 31, 2010. (Omit;the "\$" sign in your response.);(b);The;first interest payment on June 30, 2011. (Omit;the "\$" sign in your response.);(c);The;second interest payment on December 31, 2011. (Omit the "\$" sign in your response.);Worksheet;Exercise 14-6 Recording bond issuance and premium amortization L.O.;P1, P3;16.;award:3 out of;3.00 points;Exercise 15-1 Accounting for short-term held to-maturity securities L.O.;P2;Prepare;journal entries to record the following transactions involving the short-term;securities investments of Maxwell Co., all of which occurred during year;2011.;a.;On;February 15, paid \$274,000 cash to purchase FTR's 90-day short-term debt;securities (\$274,000 principal), dated February 15, that pay 8% interest;(categorized as held-to-maturity securities). (Omit the "\$" sign in your response.);b.;On May;16, received a check from FTR in payment of the principal and 90 days;interest on the debt securities purchased in transaction a. (Do not round your intermediate calculations. Use 360 days;a year. Omit the "\$" sign in your response.);Worksheet;Exercise 15-1 Accounting for short-term held to-maturity securities;L.O. P2;17.;award:3 out of;3.00 points;Exercise 15-2 Accounting for short-term trading securities L.O. P1;Prepare;journal entries to record the following transactions involving the short-term;securities investments of Smart Co., all of which occurred during year 2011.;a.;On;March 22, purchased 720 shares of FIX Company stock at \$19 per share plus a;\$230 brokerage fee. These shares are categorized as trading securities. (Omit the "\$" sign in your response.);b.;On;September 1, received a \$4 per share cash dividend on the FIX Company stock;purchased in transaction a. (Omit;the "\$" sign in your response.);c.;On;October 8, sold 360 shares of FIX Co. stock for \$29 per share, less a \$220;brokerage fee. (Do not round your;intermediate calculations. Omit the "\$" sign in your response.);Worksheet;Exercise 15-2 Accounting for short-term trading securities L.O. P1;19.;award:3 out of;3.00 points;Exercise 15-6 Accounting for trading securities L.O. P1;Forex;Co. purchases various investments in trading securities at a cost of \$75,000;on December 27, 2011. (This is its first and only purchase of such;securities.) At December 31, 2011, these securities had a fair value of;\$84,000.;1.;Prepare;the December 31, 2011, year-end adjusting entry for the trading securities;portfolio. (Omit the "\$" sign in;your response.);2.;Prepare;the January 3, 2012, entry when Forex sells a portion of its trading;securities (that had originally cost \$37,500) for \$39,750. (Omit the "\$" sign in your response.);Worksheet;Exercise 15-6 Accounting for trading securities L.O. P1;20.;award:3 out of;3.00 points;Exercise 15-7 Adjusting available-for-sale securities to fair value L.O.;P3;On;December 31, 2011, Rollo Company held the following short-term investments in;its portfolio of available-for-sale securities. Rollo had no short-term;investments in its prior accounting periods.;Cost;Fair Value;Vicks;Corporation bonds payable;\$;66,500;\$;61,100;Pace;Corporation notes payable;54,000;46,100;Lake;Lugano Company common stock;86,500;83,900;Prepare;the December 31, 2011, adjusting entry to report these investments at fair;value. (Omit the "\$" sign in your;response.);Worksheet;Exercise 15-7 Adjusting available-for-sale securities to fair value;L.O. P3

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