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ch15.doc-CHAPTER 15 STOCKHOLDERS’ EQUITY IFRS ques...
ch15.doc-CHAPTER 15 STOCKHOLDERS’ EQUITY IFRS questions
ch15.doc-CHAPTER 15 STOCKHOLDERS’ E...
ch15.doc-CHAPTER 15 STOCKHOLDERS’ EQUITY IFRS questions
Page 24
Test Bank for Intermediate Accounting, Thirteenth Edition
101.
At the beginning of 2011, Flaherty Company had retained earnings of $200,000. During
the year Flaherty reported net income of $100,000, sold treasury stock at a “gain” of
$36,000, declared a cash dividend of $60,000, and declared and issued a small stock
dividend of 3,000 shares ($10 par value) when the market value of the stock was $20 per
share. The amount of retained earnings available for dividends at the end of 2011 was
a.
$180,000.
b.
$210,000.
c.
$216,000.
d.
$246,000.
102.
Masterson Company has 420,000 shares of $10 par value common stock outstanding.
During the year Masterson declared a 5% stock dividend when the market price of the
stock was $36 per share. Three months later Masterson declared a $.60 per share cash
dividend. As a result of the dividends declared during the year, retained earnings
decreased by
a.
$1,020,600
b.
$756,000
c.
$264,600
d.
$252,000
Questions 103 and 104 are based on the following information.
Layne Corporation had the following information in its financial statements for the years ended
2010 and 2011:
Cash dividends for the year 2011
$
8,000
Net income for the year ended 2011
93,000
Market price of stock, 12/31/10
10
Market price of stock, 12/31/11
12
Common stockholders’ equity, 12/31/10
1,600,000
Common stockholders’ equity, 12/31/11
1,800,000
Outstanding shares, 12/31/11
150,000
Preferred dividends for the year ended 2011
15,000
103.
What is the payout ratio for Layne Corporation for the year ended 2011?
a.
24.7%
b.
16.1%
c.
10.3%
d.
8.6%
104.
What is the book value per share for Layne Corporation for the year ended 2011?
a.
$12.00
b.
$11.90
c.
$11.33
d.
$10.67
15 - 24
Page 25
Stockholders’ Equity
105.
At the beginning of 2011, Hamilton Company had retained earnings of $150,000. During
the year Hamilton reported net income of $75,000, sold treasury stock at a “gain” of
$27,000, declared a cash dividend of $45,000, and declared and issued a small stock
dividend of 1,500 shares ($10 par value) when the market value of the stock was $30 per
share. The amount of retained earnings available for dividends at the end of 2011 was:
a.
$184,500.
b.
$162,000.
c.
$157,500.
d.
$135,000.
106.
Mingenback Company has 560,000 shares of $10 par value common stock outstanding.
During the year Mingenback declared a 5% stock dividend when the market price of the
stock was $48 per share. Two months later Mingenback declared a $.60 per share cash
dividend. As a result of the dividends declared during the year, retained earnings
decreased by:
a.
$336,000.
b.
$352,800.
c.
$1,344,000.
d.
$1,696,800.
Questions 107 and 108 are based on the following information.
Sealy Corporation had the following information in its financial statements for the years ended
2010 and 2011:
Cash dividends for the year 2011
$
5,000
Net income for the year ended 2011
72,000
Market price of stock, 12/31/10
10
Market price of stock, 12/31/11
12
Common stockholders’ equity, 12/31/10
1,000,000
Common stockholders’ equity, 12/31/11
1,200,000
Outstanding shares, 12/31/11
100,000
Preferred dividends for the year ended 2011
10,000
107.
What is the rate of return on common stock equity for Sealy Corporation for the year
ended 2011?
a.
6.5%
b.
6.0%
c.
5.6%
d.
5.2%
108.
What is the price-earnings ratio for Sealy Corporation for the year ended 2011?
a.
16.1
b.
16.7
c.
19.4
d.
21.1
15 - 25
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