The following account balances relate to the stockholders’ equity accounts 68805

The following account balances relate to the stockholders’ equity accounts of GoreCorp. at year-end.

2010 2009 Common stock, 10,500 and 10,000 shares, respectively, for 2010 and 2009 Preferred stock, 5,000 shares Retained

A small stock dividend was declared and issued in 2010. The market value of the shares was $10,500. Cash dividends were $15,000 in both 2010 and 2009. The common stock has no par or stated value.

Instructions

(a) What was the amount of net income reported by Gore Corp. in 2010?

(b) Determine the amounts of any cash inflows or outflows related to the common stock and dividend accounts in 2010.

(c) Indicate where each of the cash inflows or outflows identified in (b) would be classified on the statement of cash flows.

Dividend
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...
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