Ex. 301
Eby Corporation issued 200,000 shares of $20 par value, cumulative, 5% preference shares on January 1, 2012, for $4,800,000. In December 2014, Eby declared its first dividend of $800,000.
Instructions
(a)Prepare Eby's journal entry to record the issuance of the preference shares.
(b)If the preference shares are
not
cumulative, how much of the $800,000 would be paid to ordinary shareholders?
(c)If the preference shares are cumulative, how much of the $800,000 would be paid to ordinary shareholders?
Solution 301(5-8 min.)
Ex. 302
The following equity accounts (in 000), arranged alphabetically, are in the ledger of Zhang Corporation at December 31, 2014.
Retained Earnings¥1,334,000
Share Capital–Ordinary (¥5 stated value)2,200,000
Share Capital–Preference (8%, ¥100 par, noncumulative)¥ 500,000
Share Premium–Preference290,000
Share Premium—Ordinary800,000
Treasury Shares (10,000 shares)110,000
Instructions
Prepare the equity section of the statement of financial position at December 31, 2014.
Ex. 303
Place each of the items listed below in the appropriate location in the equity section of a statement of financial position.
Share capital–ordinary, $10 stated value
Retained earnings
Share capital–preference, 6% $100 par value
Share premium—preference
Share premium—ordinary
Treasury shares
Share premium–treasury