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Nat2105 [25]
2 years ago
5

Permabilt Corp. was incorporated on January 1, 2019, and issued the following stock for cash: 2,000,000 shares of no-par common

stock were authorized; 750,000 shares were issued on January 1, 2019, at $35 per share. 800,000 shares of $100 par value, 7.5% cumulative, preferred stock were authorized; 540,000 shares were issued on January 1, 2019, at $105 per share. No dividends were declared or paid during 2019 or 2020. However, on December 22, 2021, the board of directors of Permabilt Corp. declared dividends of $15,000,000, payable on February 12, 2022, to holders of record as of January 8, 2022.
Prepare the journal entries to record each of the below transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
The issuance of common stock and preferred stock on January 1, 2019.
The declaration of dividends on December 22, 2021.
The payment of dividends on February 12, 2022.
b. Of the total amount of dividends declared during 2021, how much will be received by preferred shareholders?
c. Calculate the common stock dividends per share declared during 2021. (Round your answer to 2 decimal places.)
Business
1 answer:
Fantom [35]2 years ago
4 0

Answer:

Permabilt Corp.

a. Journal Entries:

Debit Cash $26,250,000

Credit Common stock $26,250,000

To record the issuance of 750,000 shares at $35 per share.

2. Debit Cash $56,700,000

Credit Preferred stock $54,000,000

Credit Additional paid-in capital- preferred stock $2,700,000

To record the issuance of 540,000 shares at $105 per share.

3. Debit Cumulative preferred stock dividends $12,150,000

Debit Common stock $2,850,000

Dividends Payable $15,000,000

To record the declaration of dividends.

b. Preferred shareholders will receive $12,150,000 out of the $15 million declared dividends during 2021 ($4,050,000 for each year)

c. Common stock dividends per share = $3.80 ($2,850,000/750,000)

Explanation:

a) Data and Calculations:

Authorized share capital:

Common stock = 2,000,000 shares of no-par value

7.5% cumulative, preferred stock = 800,000 shares at $100 par value

Issued share capital:

Common stock, 750,000 at $35 = $26,250,000

Cash $26,250,000 Common stock $26,250,000

Preferred stock, 540,000 at $105 = $56,700,000

Cash $56,700,000 Preferred stock $54,000,000 Additional paid-in capital $2,700,000

Declared Dividends = $15,000,000

Cumulative preferred stock dividends for 3 years

= $12,150,000($4,050,000 * 3)

Common stock = $2,850,000 ($15,000,000 - $12,150,000)

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Answer:

True

Explanation:

Professional skepticism is an examining mindset which makes you conscious of the situations that may suggest possible error or scam as well as a critical evaluation of audit facts.

6 0
3 years ago
On May 3, 2020, Cheyenne Company consigned 90 freezers, costing $480 each, to Remmers Company. The cost of shipping the freezers
Viktor [21]

Answer and Explanation:

The computation is shown below;

a.

Inventory Unsold in Hand (90-45) 45

Unit cost Unsold (45 × 480) $21,600.00

Shipping cost on Unit Unsold (850 ÷ 90 × 45) $425.00

Value of Inventory (21600 + 425) $22,025.00

b.  

Sale value (45 × 780) $35,100.00

Less: Cost  

Unit cost Sold (21600+425) -$22,025.00

Comission of Consignee (35,100 × 6%) -$2,106.00

Advertising cost -$210.00

Installation cost -$330.00

Net Profit $10,429.00

c.  

Sale value (45 × 780) $35,100.00

Less: deduction made by consignee  

Comission of Consignee (35100 × 6%) -$2,106.00

Advertising cost -$210.00

Installation cost -$330.00

Net Remittance made by consignee $32,454.00

5 0
3 years ago
Suppose the price level reflects the number of dollars needed to buy a basket of goods containing one can of soda, one bag of ch
IgorC [24]

Answer:

price level fall and value of money is rises

Explanation:

given data

one year basket costs =  $10.00

two year two basket costs =  $9.00

one year buy baskets = $50

year two,buy baskets = $50

to find out

as the price level falls, the value of money  will be

solution

we see that when we compare to 1 year price go down from $10 to $ 9

so deflation at annual rate is \frac{10-9}{10} = 10%

so here

sum of $50 will be buy here = \frac{50}{10} = $5 in one year

and $ 50 buy in 2 year is = \frac{50}{9} = $5.56 in two year

so this is show here that price level fall and value of money is rises

4 0
3 years ago
Degelman Company uses a job order cost system and applies overhead to production on the basis of direct labor costs. On January
zaharov [31]

Answer:

Degelman Company

Job Cost Sheets:

                                            Job 50          Job 51           Job 52

Beginning balances:

Direct materials                $23,400

Direct labor                       $24,040

Manufacturing overhead $28,720

Direct materials                    11,700         $45,630      $35,100

Direct labor                           5,850           29,250       23,400

Manufacturing overhead     7,605           38,025       30,420

Total cost of Job 50        $101,315          $74,880     $88,920

Explanation:

a) Data and Calculations:

Beginning WIP: Job 50

Direct materials                $23,400

Direct labor                       $24,040

Manufacturing overhead $28,720

Total cost of Job 50         $76,160

Finished Goods Inventory:

Completed Job No. 49 at a cost of $205,300

Raw materials $27,550

Sales of Job 49 = $142,740

Sales of Job 50 = $284,860

Manufacturing overhead:

indirect materials $19,890;

indirect labor       $23,400;

depreciation expense

on equipment     $14,040;

other manufacturing

overhead costs  $18,720

Total overheads $76,050

Applied Overhead:

              Direct Labor   Overhead Applied

Job 50       5,850                $7,605  

Job 51     29,250                38,025

Job 52    23,400                30,420

Total    $58,500               $76,050

Overhead rate = 76,050/58,500 = $1.30

5 0
3 years ago
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The answer is economic value added measure of divisional performance.

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3 0
3 years ago
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