The equity sections of balance sheets of Decent Manufacturing Company for the years ended on 30...

 

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The equity sections of balance sheets of Decent Manufacturing Company for the years ended on 30 June 2019 and 30 June 2020 were as under:- Stockholders' equity 30-06-2019 Common Stock Rs. 10 par value 100,000 shares authorized, 40,000 shares issued. Premium on Common Stock Retained Earnings Total Equity Stockholders' Equity 30-06-2020 Common Stock Rs. 10 par value 100,000 shares authorized, 60,000 shares issued. Premium on Common Stock Retained Earnings Total Equity Rs. 400,000 Rs. 80,000 10-06-2020 Paid interim cash dividend declared on 10-05-2020. 15-06-2020 Issued additional 12,000 shares of Rs. 10 each at some premium. Rs. 420,000 Rs. 900,000 The undernoted transactions and events affected equity sections during 2019- 2020:- Rs. 600,000 Rs. 148,000 Rs. 650,000 Rs. 1,398,000 15-07-2019 Declared Rs. 2.00 per share cash dividend to Stockholders of record date 30-06-2019. Paid Cash dividend declared on 15-07-2019 10-08-2019 20-08-2019 Declared Stock dividend of one common stock for every five Common Stocks of record date 30-06- 2019. The market value of Common Stock on this date was Rs. 14 per share.. 10-05-2020 Declared interim cash dividend of Rs. 1.00 per share of record date of 30-04-2020. 456 Required 1) How many Common Stocks were outstanding on each cash dividend declaration dates. 2) Compute the cash amount paid as dividends to the common stockholders. 3) Calculate the amount of capitalization of retained earnings for the stock dividends. 4) Compute the net income earned during 2019-20. 5) Compute the premium per stock on additional shares issued on 15-06-2020. 6) Pass necessary accounting entries for the above transactions. The equity sections of balance sheets of Decent Manufacturing Company for the years ended on 30 June 2019 and 30 June 2020 were as under:- Stockholders' equity 30-06-2019 Common Stock Rs. 10 par value 100,000 shares authorized, 40,000 shares issued. Premium on Common Stock Retained Earnings Total Equity Stockholders' Equity 30-06-2020 Common Stock Rs. 10 par value 100,000 shares authorized, 60,000 shares issued. Premium on Common Stock Retained Earnings Total Equity Rs. 400,000 Rs. 80,000 10-06-2020 Paid interim cash dividend declared on 10-05-2020. 15-06-2020 Issued additional 12,000 shares of Rs. 10 each at some premium. Rs. 420,000 Rs. 900,000 The undernoted transactions and events affected equity sections during 2019- 2020:- Rs. 600,000 Rs. 148,000 Rs. 650,000 Rs. 1,398,000 15-07-2019 Declared Rs. 2.00 per share cash dividend to Stockholders of record date 30-06-2019. Paid Cash dividend declared on 15-07-2019 10-08-2019 20-08-2019 Declared Stock dividend of one common stock for every five Common Stocks of record date 30-06- 2019. The market value of Common Stock on this date was Rs. 14 per share.. 10-05-2020 Declared interim cash dividend of Rs. 1.00 per share of record date of 30-04-2020. 456 Required 1) How many Common Stocks were outstanding on each cash dividend declaration dates. 2) Compute the cash amount paid as dividends to the common stockholders. 3) Calculate the amount of capitalization of retained earnings for the stock dividends. 4) Compute the net income earned during 2019-20. 5) Compute the premium per stock on additional shares issued on 15-06-2020. 6) Pass necessary accounting entries for the above transactions.

Answer rating: 100% (QA)

1 On each cash dividend declaration date the following number of common stocks were outstanding 1507... View the full answer