Altuve Co. was incorporated on January 1, 2013, at which time 500,000 shares of $1 par value

Question:

Altuve Co. was incorporated on January 1, 2013, at which time 500,000 shares of $1 par value common stock were authorized, and 210,000 of these shares were issued for $15 per share. Net income for the year ended December 31, 2013, was $2,400,000. Altuve Co.'s board of directors declared dividends of $4 per share of common stock on December 31, 2013, payable on February 7, 2014.


Required:

Use the horizontal model (or write the entry) to show the effects of

a. The issuance of common stock on January 1, 2013.

b. The declaration of dividends on December 31, 2013.

c. The payment of dividends on February 7, 2014.


Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...
Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...
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Related Book For  answer-question

Accounting What the Numbers Mean

ISBN: 978-0078025297

10th edition

Authors: David H. Marshall, Wayne W. McManus, Daniel F. Viele

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