Information concerning the capital structure of Blossom Corporation is as follows:December 31,20252024Common stock140000 shares140000 sharesConvertible preferred stock14000 shares14000 shares5% convertible bonds$2300000$2300000In 2025, Blossom paid dividends of $0.70 per share on its common stock and $2.00 per share on its preferred stock. The preferredstock is convertible into 29000 shares of common stock. The 5% convertible bonds are convertible into 74000 shares of commonstock. The net income for the year ended December 31, 2025, was $390920. Assume that Blossom's income tax rate was 30%.What should Blossom report for diluted earnings per share for the year ended December 31, 2025?$2.07$1.94$1.83O $2.20

2. Potential Conversion:Potential Common Shares from Preferred Stock: CPS * CR (Preferred) = 14,000…

Answered: Information concerning the capital…

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 26P

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Alert Companys shareholders equity prior to any of the following events is as follows: The company is considering the following alternative items: 1. An 8% stock dividend on the common stock when it is selling for 30 per share. 2. A 30% stock dividend on the common stock when it is selling for 32 per share. 3. A special stock dividend to common shareholders consisting of 1 share of preferred stock for every 100 shares of common stock. The preferred stock and common stock are selling for 123 and 31 per share, respectively. 4. A 2-for-1 stock split on the common stock, reducing the par value to 5 per share (assume the same date for declaration and issuance). The market price is 30 per share on the common stock. 5. A property dividend to common shareholders consisting of 100 bonds issued by West Company. These bonds are carried on the Alert Company books as an available-for sale investment at a fair value of 48,000 (which is also its cost); it has a current value of 54,000. 6. A cash dividend, consisting of a normal dividend and a liquidating dividend, on both the preferred and the common stock. The 10% preferred dividend includes a 2% liquidating dividend, and the 2.30 per share common dividend includes a 0.30 per share liquidating dividend (separate liquidating dividend contra accounts should be used). Required: For each of the preceding alternative items: 1. Record (a) the journal entry at the date of declaration and (b) the journal entry at the date of issuance. 2. Compute the balances in the shareholders equity accounts immediately after the issuance (any gains or losses are to be reflected in the retained earnings balance; ignore income taxes).
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.
Contributed Capital Adams Companys records provide the following information on December 31, 2019: Additional information: 1. Common stock has a 5 par value, 50,000 shares are authorized, 15,000 shares have been issued and are outstanding. 2. Preferred stock has a 100 par value, 3,000 shares are authorized, 800 shares have been issued and are outstanding. Two hundred shares have been subscribed at 120 per share. The stock pays an 8% dividend, is cumulative, and is callable at 130 per share. 3. Bonds payable mature on January 1, 2023. They carry a 12% annual interest rate, payable semiannually. Required: Prepare the Contributed Capital section of the December 31, 2019, balance sheet for Adams. Include appropriate parenthetical notes.
Information concerning the capital structure of Sandhill Corporation is as follows: Common stock Convertible preferred stock 5% convertible bonds O $1.60 O $2.80 2025 O $1.78 $2.50 December 31. 144000 shares 14500 shares $2390000 2024 In 2025, Sandhill paid dividends of $0.9 per share on its common stock and $3 per share on its preferred stock. The preferred stock is convertible into 29600 shares of comman stock. The 5% convertible bonds are convertible into 75800 shares of common stock. The net income for the year ended December 31, 2025, was $403000. Assume that the income tax rate was 30%. What should be the basic earnings per share for the year ended December 31, 2025? 144000 shares 14500 shares $2390000
Information concerning the capital structure of Carla Vista Corporation is as follows: December 31, 2025 2024 Common stock 157000 shares 157000 shares Convertible preferred stock 15100 shares 15100 shares 7% convertible bonds $2310000 $2310000 In 2025, Carla Vista paid dividends of $0.90 per share on its common stock and $3.00 per share on its preferred stock. The preferre stock is convertible into 29900 shares of common stock. The 7% convertible bonds are convertible into 75400 shares of common stock. The net income for the year ended December 31, 2025, was $411410. Assume that Carla Vista's income tax rate was 30%. What should Carla Vista report for diluted earnings per share for the year ended December 31, 2025? O $2.26 ○ $2.06 O $1.77 $2.00
Information concerning the capital structure of Pharoah Corporation is as follows: 2025 2026 Common stock 146000 shares 146000 shares Convertible preferred stock 15100 shares 15100 shares 6% convertible bonds $2460000 $2460000 In 2025, Pharoah paid dividends of $0.90 per share on its common stock and $3.00 per share on its preferred stock. The preferred stock is convertible into 30800 shares of common stock. The 6% convertible bonds are convertible into 75800 shares of common stock. The net income for the year ended December 31, 2025, was $401880. Assume that Pharoah's income tax rate was 30%. What should Pharoah report for diluted earnings per share for the year ended December 31, 2025? a) $1.81 b) $2.00 c) $ 2.28 d) $2.07
ion Shown below is information relating to the stockholders' equity of Ozone Corporation at June 30, 2023. $400,000 6% cumulative preferred stock, $100 par, 50,000 shares authorized Common stock, $4.55 par, 40,000 shares authorized; 30,800 shares issued and outstanding Additional paid-in capital: preferred stock Additional paid-in capital: common stock Retained earnings What is total paid-in capital? Select one: O a. $2,160,000. O b. $540,000. O c. $2,040,000. O d. $660,000. $140,000 $100,000 $1,400,000 $120,000
Information concerning the capital structure of Martinez Corporation follows: Common shares outstanding Convertible preferred shares outstanding 9% convertible bonds December 31, O $3.99 O $2.99 $3.57 O $3.73 2023 108000 shares 10800 shares $2000000 2022 108000 shares 10800 shares $2000000 During 2023, Martinez paid dividends of $1.00 per common share and $2.50 per preferred share. The preferred shares are non- cumulative, and convertible into 21600 common shares. The 9% convertible bonds are convertible into 40000 common shares. Net income for calendar 2023 was $506608. Assume the income tax rate is 30%. What is the diluted earnings per share for 2023?
7. Charlotte Company provided the following information in relation to share capital: January 1, 2020 April 1, 2020 October 1, 2020 Shares outstanding Shares issued 1,500,000 240,000 120,000 Treasury shares purchased Issued a 100% share dividend December 1, 2020 What is the number of weighted average shares? 8. Daisy Company had 350,000 ordinary shares outstanding on January 1, 2020. During 2020 and 2021, the following transactions took place. Sold 33,600 shares Issued a 20 percent stock dividend Sold 22,400 shares Purchased 21,000 shares to be held in treasury 2020 March I July I October 1 December 1 3 for 1 share split Sold 84,000 shares 2021 June I September 1 What is the weighted average number of shares for 2020 to be used in the earnings per share computation for comparative financial statements at the end of 2021? b. What is the weighted number of shares for 2021 used in the earnings per share computation for comparative financial statement at the end of 2021? a.
The following partial information is taken from the comparative balance sheet of Levi Corporation:   Shareholders’ equity 12/31/2021 12/31/2020 Common stock, $5 par; 34 million shares authorized; 29 million shares issuedand 25 million shares outstanding at 12/31/2021; and ____million sharesissued and ____shares outstanding at 12/31/2020. $ 145 million $ 125 million Additional paid-in capital on common stock 521 million 392 million Retained earnings 194 million 158 million Treasury common stock, at cost, 4 million shares at 12/31/2021 and 2 millionshares at 12/31/2020 (69 million) (47 million) Total shareholders’ equity $ 791 million $ 628 million What was the average price (rounded to the nearest dollar) of the additional shares issued by Levi in 2021?
The following information relates to X, Y, and Z as at 30 June 2021 Stock Share price Number of shares X 10 2,000,000 Y 15 6,000,000 Z 20 10,000,000 During the year the following activities occurred; A two for one stock split on Y Payment of 10% dividend on Z. It can be assumed that the entire dividend paid will be reinvested in shares of Z limited. On 30 June 2022 the stock prices of X, Y and Z were sh 12, sh 10 and sh 20 respectively. Required; New index value given that the beginning value index is 100. Explain how secondary markets benefit investors.    State and explain the main risks faced by financial institutions in the course of conduct of their business.
The following partial information is taken from the comparative balance sheet of Levi Corporation:   Shareholders’ equity 12/31/2021 12/31/2020 Common stock, $5 par; 36 million shares authorized; 31 million sharesissued and 26 million shares outstanding at 12/31/2021; and ____million sharesissued and ____shares outstanding at 12/31/2020. $ 155 million $ 130 million Additional paid-in capital on common stock 523 million 401 million Retained earnings 192 million 160 million Treasury common stock, at cost, 5 million shares at 12/31/2021 and 2 millionshares at 12/31/2020 (85 million) (48 million) Total shareholders’ equity $ 785 million $ 643 million What was the average price of the additional treasury shares purchased by Levi during 2021? (Round your answer to 2 decimal places.)

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