Question

Horizon Communications has the following stockholders’ equity on December 31, 2016:
Stockholders' Equity
Paid-In Capital:
Preferred Stock—4%, $11 Par Value; 150,000 shares authorized, 22,000 shares issued and outstanding .............. $ 242,000
Common Stock—$4 Par Value; 575,000 shares authorized, 350,000 shares issued and outstanding ................. 1,400,000
Paid-In Capital in Excess of Par—Common ...... 1,050,000
Total Paid-In Capital .............. 2,692,000
Retained Earnings ............... 220,000
Total Stockholders' Equity ........... $2,912,000
Requirements
1. Assuming the preferred stock is cumulative, compute the amount of dividends to preferred stockholders and to common stockholders for 2016 and 2017 if total dividends are $7,680 in 2016 and $49,000 in 2017. Assume no changes in preferred stock and common stock in 2017.
2. Record the journal entries for 2016, assuming that Horizon Communications declared the dividend on December 1 for stockholders of record on December 10. Horizon Communications paid the dividend on December 20.


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  • CreatedJune 15, 2015
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