Ex. 308
On November 1, 2014, Norris Corporation's equity section is as follows:
Share capital–ordinary, $10 par value$ 600,000
Share premium–ordinary205,000
Retained earnings 240,000
Total equity$1,045,000
On November 1, Norris declares and distributes a 20% share dividend when the market value is $13 per share.
Instructions
Indicate the balances in the equity accounts after the share dividend has been distributed.
Ex. 309
During 2014, Pine Corporation had the following transactions and events:
1.Issued par value preference shares for cash at par value.
2.Issued par value ordinary shares for cash at an amount greater than par value.
3.Completed a 2 for 1 share split in which the $10 par value ordinary shares were changed to $5 par value shares.
4.Declared a small share dividend when the market value was higher than the par value.
5.Declared a cash dividend.
6.Made a prior period adjustment for understatement of net income.
7.Issued par value ordinary shares for cash at par value.
8.Paid the cash dividend.
9.Issued the ordinary shares required by the share dividend declaration in 4. above.
Instructions
Indicate the effect(s) of each of the foregoing items on the subdivisions of equity. Present your answers in tabular form with the following columns. Use (I) for increase, (D) for decrease, and (NE) for no effect.
Share ShareRetained
ItemCapital PremiumEarnings
Ex. 310
The following information is available for Ellis Corporation:
Share Capital–Ordinary (€5 par)€1,500,000
Retained Earnings600,000
A 10% share dividend is declared and paid when the market value was €15 per share.
Instructions
Compute each of the following after the share dividend.
(a)Total equity.
(b)Number of shares outstanding.