Fleurage Inc. is a public enterprise whose shares are traded in the over the countermarket. At December 31, 2020, Fleurage had 6,000,000 authorized shares of P10 parvalue common stock, of which 2,800,000 shares were issued and outstanding. Thestockholders' equity accounts at December 31, 2020, had the following balances..Transactions during 2021 and other information relating to the stockholders' equityaccounts were as follows:.. On January 5, 2021, Fleurage issued at P56 per share, 125,000 shares of P50 parvalue, 9% cumulative convertible preferred stock. Each share of preferred stock isconvertible, at the option of the holder, into two shares of common stock. Fleurage.had 600,000 authorized shares of preferred stock. The preferred stock has aliquidation value equal to 125% of its par value..Share Capital-OrdinaryShare Premium-OrdinaryRetained earnings.On February 1, 2021, Fleurage reacquired 25,000 shares of its common stock forP16 per share, Fleurage uses the cost method to account for treasury stock.On April 30, 2021, Fleurage sold 650,000 shares (previously unissued) of P10 parvalue common stock to the public at P17 per share.. On June 18, 2021, Fleurage declared a cash dividend of P1.50 per share ofcommon stock, payable on July 12, 2021, to stockholders' record on July 1, 2021.On May 13, 2021, Fleurage issued 540,000 stock rights. Five rights, plus P30 incash, are required to purchase one new Fleurage ordinary share. On the date ofissuance, Fleurage stock was selling for P75 per share.On November 10, 2021, Fleurage sold 10,000 shares of treasury stock for P24 pershare. On December 14, 2021, Fleurage declared the yearly cash dividend on preferredstock, payable on January 14, 2022, to stockholders of record on December 31,2021.ItemOn January 20, 2022, before the books were closed for 2021, Fleurage becameaware that the ending inventories at December 31, 2021 were understated byP300,000 (gross of tax; where income tax rate is 30%). The appropriate correctionentry was recorded the same day.. After correcting the 2021 ending inventory, net income for 2021 was P6,000,000.Required:Prepare a working paper (use template) and compute for (a) total shareholders' equityand (b) book value per ordinary share.Boga)b)****EndShareCapitalProforonc●xXxxxxShareCapital-OrdinarYXxxP28,000,0011,500,0008,450,000XXXShare SharePremium PremiumOrdinaryProforenc0XXXxxx0TKKXxRetaineCEarning$XXXXXTreasury Stock(xxx)DOTotalShareholdersEquityXxxx

Share capital transactions for Fleurage Inc during the year 2021 are given to us based on which the…

Required: Prepare a working paper (use template) and compute for (a) total shareholders' equity and (b) book value per ordinary share. Item Bog a) b) End Share Capital Proforonc X Share Share Share Capital - Premium Premium Ordinar Proforenc Ordinary xx XXX XX E Retaine Treasur y Stock Earning x 18 Tocal Shareholders Equity XX

Required: Prepare a working paper (use template) and compute for (a) total shareholders' equity and (b) book value per ordinary share. Item Bog a) b) End Share Capital Proforonc X Share Share Share Capital - Premium Premium Ordinar Proforenc Ordinary xx XXX XX E Retaine Treasur y Stock Earning x 18 Tocal Shareholders Equity XX

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter16: Retained Earnings And Earnings Per Share

Section: Chapter Questions

Problem 9P

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Anoka Company reported the following selected items in the shareholders equity section of its balance sheet on December 31, 2019, and 2020: In addition, it listed the following selected pretax items as a December 31, 2019 and 2020: The preferred shares were outstanding during all of 2019 and 2020; annual dividends were declared and paid in each year. During 2019, 2,000 common shares were sold for cash on October 4. During 2020, a 20% stock dividend was declared and issued in early May. At the end of 2019 and 2020, the common stock was selling for 25.75 and 32.20, respectively. The company is subject to a 30% income tax rate. Required: 1. Prepare the comparative 2019 and 2020 income statements (multiple-step), and the related note that would appear in Anokas 2020 annual report. 2. Next Level Compute the price/earnings ratio for 2020. How does this compare to 2019? Why is it different?
The controller of Red Lake Corporation has requested assistance in determining income, basic earnings per share, and diluted earnings per share for presentation on the companys income statement for the year ended September 30, 2020. As currently calculated, Red Lakes net income is 540,000 for fiscal year 2019-2020. Your working papers disclose the following opening balances and transactions in the companys capital stock accounts during the year: 1. Common stock (at October 1, 2019, stated value 10, authorized 300,000 shares; effective December 1, 2019, stated value 5, authorized 600,000 shares): Balance, October 1, 2019issued and outstanding 60,000 shares December 1, 201960,000 shares issued in a 2-for-l stock split December 1, 2019280,000 shares (stated value 5) issued at 39 per share 2. Treasury stockcommon: March 3, 2020purchased 40,000 shares at 38 per share April 1, 2020sold 40,000 shares at 40 per share 3. Noncompensatory stock purchase warrants, Series A (initially, each warrant was exchangeable with 60 for 1 common share; effective December 1, 2019, each warrant became exchangeable for 2 common shares at 30 per share): October 1, 201925,000 warrants issued at 6 each 4. Noncompensatory stock purchase warrants, Series B (each warrant is exchangeable with 40 for 1 common share): April 1, 202020,000 warrants authorized and issued at 10 each 5. First mortgage bonds, 5%, due 2029 (nonconvertible; priced to yield 5% when issued): Balance October 1, 2019authorized, issued, and outstandingthe face value of 1,400,000 6. Convertible debentures, 7%, due 2036 (initially, each 1,000 bond was convertible at any time until maturity into 20 common shares; effective December 1, 2019, the conversion rate became 40 shares for each bond): October 1, 2019authorized and issued at their face value (no premium or discount) of 2,400,000 The following table shows the average market prices for the companys securities during 2019-2020: Adjusted for stock split Required: Prepare a schedule computing: 1. the basic earnings per share 2. the diluted earnings per share that should be presented on Red Lakes income statement for the year ended September 30, 2020 A supporting schedule computing the numbers of shares to be used in these computations should also be prepared. Assume an income tax rate of 30%.
Comprehensive The shareholders equity section of Superior Corporations balance sheet as of December 31, 2018, is as follows: The following events occurred during 2019: Required: 1. Prepare journal entries for each of the above transactions. 2. Calculate the number of authorized, issued, and outstanding common shares as of December 31, 2019. 3. Calculate Superior's legal capital at December 31, 2019.
Gray Company lists the following shareholders equity items on its December 31, 2018, balance sheet: The following stock transactions occurred during 2019: Required: 1. Prepare journal entries to record the preceding transactions. 2. Prepare the December 31, 2019, shareholders equity section (assume that 2019 net income was 225,000).
Jumbo Corporation reported the following information about its stock on its December 31, 2018, balance sheet: Jumbo Corporation engaged in the following stock transactions during 2019: Required: 1. Does Jumbo Corporation have a simple or complex capital structure? 2. Calculate the number of shares that Jumbo would use to calculate basic EPS for its 2019 income statement.
Monona Company reported net income of 29,975 for 2019. During all of 2019, Monona had 1,000 shares of 10%, 100 par, nonconvertible preferred stock outstanding, on which the years dividends had been paid. At the beginning of 2019, the company had 7,000 shares of common stock outstanding. On April 2, 2019, the company issued another 2,000 shares of common stock so that 9,000 common shares were outstanding at the end of 2019. Common dividends of 17,000 had been paid during 2019. At the end of 2019, the market price per share of common stock was 17.50. Required: 1. Compute Mononas basic earnings per share for 2019. 2. Compute the price/earnings ratio for 2019.
Raun Company had the following equity items as of December 31, 2019: Preferred stock, 9% cumulative, 100 par, convertible Paid-in capital in excess of par value on preferred stock Common stock, 1 stated value Paid-in capital in excess of stated value on common stock| Retained earnings The following additional information about Raun was available for the year ended December 31, 2019: 1. There were 2 million shares of preferred stock authorized, of which 1 million were outstanding. All 1 million shares outstanding were issued on January 2, 2016, for 120 a share. The preferred stock is convertible into common stock on a 1-for-1 basis until December 31, 2025; thereafter, the preferred stock ceases to be convertible and is callable at par value by the company. No preferred stock has been converted into common stock, and there were no dividends in arrears at December 31, 2019. 2. The common stock has been issued at amounts above stated value per share since incorporation in 2002. Of the 5 million shares authorized, 3,580,000 were outstanding at January 1, 2019. The market price of the outstanding common stock has increased slowly but consistently for the last 5 years. 3. Raun has an employee share option plan where certain key employees and officers may purchase shares of common stock at 100% of the marker price at the date of the option grant. All options are exercisable in installments of one-third each year, commencing 1 year after the date of the grant, and expire if not exercised within 4 years of the grant date. On January 1, 2019, options for 70,000 shares were outstanding at prices ranging from 47 to 83 a share. Options for 20,000 shares were exercised at 47 to 79 a share during 2019. During 2019, no options expired and additional options for 15,000 shares were granted at 86 a share. The 65,000 options outstanding at December 31, 2019, were exercisable at 54 to 86 a share; of these, 30,000 were exercisable at that date at prices ranging from 54 to 79 a share. 4. Raun also has an employee share purchase plan whereby the company pays one-half and the employee pays one-half of the market price of the stock at the date of the subscription. During 2019, employees subscribed to 60,000 shares at an average price of 87 a share. All 60,000 shares were paid for and issued late in September 2019. 5. On December 31, 2019, there was a total of 355,000 shares of common stock set aside for the granting of future share options and for future purchases under the employee share purchase plan. The only changes in the shareholders equity for 2019 were those described previously, the 2019 net income, and the cash dividends paid. Required: Prepare the shareholders equity section of Rauns balance sheet at December 31, 2019. Substitute, where appropriate, Xs for unknown dollar amounts. Use good form and provide full disclosure. Write appropriate notes as they should appear in the publisher financial statements.
Included in the December 31, 2018, Jacobi Company balance sheet was the following shareholders equity section: The company engaged in the following stock transactions during 2019: Required: 1. Prepare journal entries to record the preceding transactions. 2. Prepare the December 31, 2019, shareholders equity section (assume that 2019 net income was 270,000).
Oakwood Inc. is a public enterprise whose shares are traded in the over-the-counter market. At December 31, 2018, Oakwood had 6,000,000 authorized shares of $10 par value common stock, of which 2,000,000 shares were issued and outstanding. The shareholders’ equity accounts at December 31, 2018, had the following balances: Transactions during 2019 and other information relating to the shareholders’ equity accounts were as follows: 1. On January 5, 2019, Oakwood issued at $54 per share, 100,000 shares of $50 par value, 9%, cumulative convertible preferred Stock. Each share of preferred stock is convertible, at the option of the holder, into 2 shares of common stock. Oakwood had 600,000 authorized shares of preferred stock. 2. On February 2, 2019, Oakwood reacquired 20,000 shares of its common stock for $16 per share. Oakwood uses the cost method to account for treasury stock. 3. On April 27, 2019, Oakwood sold 500,000 shares (previously unissued) of $10 par value common stock to the…
Grouper Company reported the following amounts in the stockholders' equity section of its December 31, 2019, balance sheet. Preferred stock, 10%, $100 par (10,000 shares authorized, 2,000 shares issued) Common stock, $5 par (110,000 shares authorized, 22,000 shares issued) Additional paid-in capital Retained earnings Total 1. 2. 3. During 2020, Grouper took part in the following transactions concerning stockholders' equity. 4. 5. 6. 7. Capital Stock Paid the annual 2019 $10 per share dividend on preferred stock and a $2 per share dividend on common stock. These dividends had been declared on December 31, 2019. Common Stock Purchased 1,700 shares of its own outstanding common stock for $41 per share. Grouper uses the cost method. Reissued 600 treasury shares for land valued at $28,400. Issued 480 shares of preferred stock at $103 per share. Declared a 10% stock dividend on the outstanding common stock when the stock is selling for $44 per share. Issued the stock dividend. Preferred…
The following transactions were taken from the records of Marimar Company for you to prepare a statement of changes in equity for the year ended December 31, 2019. After preparing the statement of changes in equity, provide a paragraph explaining the importance of providing this information to the varied users of financial statements. On January 1, 2019, Marimar company had 3,000,000 authorized ordinary shares of P5 par, of which 1,000,000 shares were issued and outstanding on that date. Account balances appear for the shareholders’ equity items of Marimar company on January 1, 2019:Ordinary share capital 5,000,000Share Premium 3,750,000Retained Earnings 1,625,000 The following transactions transpired during the year:January 6 Iissued at P54 per share, 50,000 shares of P50 par, 9% cumulative, convertible preference share capital. Marimar had 125,000 authorized preference shares. Feb. 3…
The shareholders’ equity section of Superior Corporation’s balance sheet as of December 31, 2018, is as follows: 1. Prepare journal entries for each of the above transactions. 2. Calculate the number of authorized, issued, and outstanding common shares as of December 31, 2019. 3. Calculate Superior’s legal capital at December 31, 2019.