Question

Madison Hotel, Inc. included the following shareholders’ equity on its year-end balance sheet at December 31, 2014, with all dollar amounts in millions:
Shareholders’ Equity $ Millions
Share Capital:
Preferred Shares, 6.5% cumulative ......... $ 45
Common Shares; 500,000,000 shares authorized,
176,000,000 shares issued and outstanding ...... 228
Total Share Capital ............... 273
Retained Earnings ............... 142
Total Shareholders’ Equity ............ $415
Requirements
1. Identify the different issues of shares Madison Hotel, Inc. has outstanding.
2. Give the two entries to record issuance of the Madison Hotel Inc. shares. Assume all the shares were issued for cash. Explanations are not required.
3. Assume that preferred dividends are in arrears for 2013 and 2014. Record the declaration of a $37 million cash dividend on December 30, 2015. Use separate Dividends Payable accounts for preferred and common shares. Round to the nearest $1 million. An explanation is not required.


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  • CreatedJuly 08, 2015
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