Knudsen Bakeries was organized on January 1, 2019. During its first year, the company issued 2,000 shares
Question:
Knudsen Bakeries was organized on January 1, 2019. During its first year, the company issued 2,000 shares of HK$50 par value preference shares and 100,000 shares of HK$10 par value ordinary shares. At December 31, the company declared the following cash dividends: 2019, HK$5,000; 2020, HK$12,000; and 2021, HK$28,000 (HK$ in thousands).
Instructions
a. Show the allocation of dividends to each class of shares, assuming the preference share dividend is 6% and non-cumulative.
b. Show the allocation of dividends to each class of shares, assuming the preference share dividend is 7% and cumulative.
c. Journalize the declaration of the cash dividend at December 31, 2021, under part (b).
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their... 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,...
Step by Step Answer:
a 2019 2020 2021 Total dividend Allocation to preference shares Remainder to ordinary shares HK...View the full answer
Accounting Principles
ISBN: 978-1119419617
IFRS global edition
Authors: Paul D Kimmel, Donald E Kieso Jerry J Weygandt
