196.On January 1, Swanson Corporation had 80,000 ordinary shares with a €10 par value outstanding. On March 17, the company declared a 15% share dividend to shareholders of record on March 20. Market value of the shares was €13 on March 17. The entry to record the transaction of March 17 would include a
a.credit to Cash Dividends for €36,000.
b.credit to Cash for €156,000.
c.credit to Ordinary Share Dividends Distributable for €120,000.
d.debit to Ordinary Share Dividends Distributable for €120,000.
197.On January 1, Swanson Corporation had 80,000 ordinary shares with a €10 par value outstanding. On March 17, the company declared a 15% share dividend to shareholders of record on March 20. Market value of the shares was €13 on March 17. The shares were distributed on March 30. The entry to record the transaction of March 30 would include a
a.credit to Cash for €120,000.
b.debit to Ordinary Share Dividends Distributable for €120,000.
c.credit to Share Premium–Ordinary for €36,000.
d.debit to Cash Dividends for €36,000.
198.On January 1, Sandford Corporation had 120,000 ordinary shares with a $10 par value outstanding. On June 17, the company declared a 15% share dividend to shareholders of record on June 20. Market value of the shares was $15 on June 17. The entry to record the transaction of June 17 would include a
a.debit to Cash Dividends for $270,000.
b.credit to Cash for $270,000.
c.credit to Ordinary Share Dividends Distributable for $270,000.
d.credit to Ordinary Share Dividends Distributable for $180,000.
199.On January 1, Sanford Corporation had 120,000 ordinary shares with a $10 par value outstanding. On June 17, the company declared a 15% share dividend to shareholders of record on June 20. Market value of the shares was $15 on June 17. The shares were distributed on June 30. The entry to record the transaction of June 30 would include a
a.credit to Share Capital–Ordinary for $180,000.
b.debit to Ordinary Share Dividends Distributable for $270,000.
c.credit to Share Premium–Ordinary for $90,000.
d.debit to Cash Dividends for $90,000.
200.Colson Inc. declared a $160,000 cash dividend. It currently has 6,000 shares of 6%, $100 par value cumulative preference share outstanding. It is one year in arrears on its preference stock. How much cash will Colson distribute to the ordinary shareholders?
a.$88,000.
b.$72,000.
c.$124,000.
d.None.
201.Ludwick Inc. has retained earnings of $800,000 and total equity of $2,000,000. It has 200,000 ordinary shares with a $5 par value outstanding, which is currently selling for $30 per share. If Ludwick declares a 15% share dividend on its ordinary shares
a.net income will decrease by $150,000.
b.retained earnings will decrease by $150,000 and total equity will increase by $150,000.
c.retained earnings will decrease by $900,000 and total equity will increase by $900,000.
d.retained earnings will decrease by $900,000 and share capital and share premium will increase by $900,000.
202.On December 31, 2014, Springer, Inc. has 3,000 shares of 5% $100 par value cumulative preference shares and 45,000 ordinary shares with a $10 par value outstanding. On December 31, 2014, the directors declare a $15,000 cash dividend. The entry to record the declaration of the dividend would include
a.a credit of $5,000 to Retained Earnings.
b.a note in the financial statements that dividends of $5 per share are in arrears on preference shares for 2014.
c.a debit of $15,000 to Share Capital–Ordinary.
d.a credit of $15,000 to Dividends Payable.
203.Franklin, Inc. declares a 10% ordinary share dividend when it has 40,000 ordinary shares with a $10 par value outstanding. If the market value of $24 per share is used, the amounts debited to Retained Earnings and credited to Share Premium–Ordinary are
Retained Share Premium–
Earnings Ordinary
a.$40,000$0
b.$96,000$56,000
c.$96,000$40,000
d.$40,000$56,000
204.Shannon Manufacturing declared a 10% share dividend when it had 300,000 ordinary shares with a $3 par value outstanding. The market price per share was $12 per share when the dividend was declared. The entry to record this dividend declaration includes a credit to
a.Retained Earnings for $90,000.
b.Share Premium–Ordinary for $270,000.
c.Share Capital–Ordinary for $360,000.
d.Ordinary Share Dividends Distributable for $360,000.
205.On December 1, 2013, the Board of directors of Dew Laurintis Company declared a €.60 per share dividend payable on January 3, 2014 to shareholders of record on December 16. The company had 500,000 shares authorized and 225,000 shares issued and outstanding.
The journal entry made on December 1, 2013 will
a.reduce assets by €135,000.
b.reduce equity by €135,000.
c.increase expenses by €300,000.
d.increase liabilities by €300,000.