Mcgraw-hill Connect Week 3 Assignment

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Problem-1

The balance sheet caption for common stock is the following:

Common stock, $2 par value, 2,800,000 shares authorized, 1,400,000 shares issued, 1,010,000 shares outstanding

Required:

a. Calculate the dollar amount that will be presented opposite this caption.

b. Calculate the total amount of a cash dividend of $0.28 per share.

c. What accounts for the difference between issued shares and outstanding shares?

Problem-2

At the beginning of the current fiscal year. the balance sheet of Hughey Inc. showed stockholders’ equity of $525,000. During the year. liabilities increased by $23,000 to $231,000; paid-in capital increased by $30,000 to $173,000; and assets increased by $252,000. Dividends declared and paid during the year were $49,000

Required:

Calculate net income or loss for the year. (Amounts to be deducted should be indicated with a minus sign.)

Problem-3

Assume that you own 100 shares of $10 par value common stock of a company and the company has a 2-for-1 stock split when the market price per share is $56.

Required:

a. How many shares of common stock will you own after the stock split?

b. What w ill probably happen to the market price per share of the stock?

c. What w ill probably happen to the par value per share of the stock?

Problem-4 – Mcgraw hill connect accounting chapter 3 homework answers

Refer to the data below

Retained earnings, December 31, 2019         $34 2 ,100

Cost of buildings purchased during 2020        41,200

Net income for the year ended December 31 , 2020      55,900

Dividends declared and paid in 2020            32,700

Increase in cash balance from January 1, 2020, t o December 31, 2020     22,700

Increase in long -term debt in 2020   45,500

Required:

From the above data, calculate tt1e Retained Earnings balance as of December 31, 2020:

Problem-5

Rosie Inc. did not pay dividends on its $7.00, $48 par value, cumulative preferred stock during 2018 or 2019, but had met its preferred dividend requirement in all prior years. Since 2014, 27,000 shares of this stock have been outstanding. Rosie Inc. has been profitable in 2020 and is considering a cash dividend on its common stock that would be payable in December 2020.

Required:

Calculate the amount of dividends that would have to be paid on the preferred stock before a cash dividend could be paid to the common stockholders.

Problem-6

Franklin Co. has experienced gross profit ratios for 2019, 2018, and 2017 of 33.00%, 29.75%, and 31.25%, respectively On April 3, 2020, the firm’s plant and all its inventory were destroyed by a tornado

Accounting records for 2020, which were available because they were stored in a protected vault, showed the following:

Sales from January 1 through April 2          $141,420

January 1 inventory amount                63,900

Purchases of inventory from January 1 through April 2        118,046

Required:

Calculate the amount of t he insurance claim to be filed for the inventory destroyed in the tornado (Hint: Use the cost of goods sold model and a gross profit ratio that will result in the largest claim) (Do not round intermediate calculations.)

Problem-7

Selling, general, and administrative expenses were $68,000; net sales were $309,000; interest expense was $7,300; research and development expenses were $32,300; net cash provided by operating activities was $81,200; income tax expense was $7,800; cost of goods sold was $169,400.

Required:

Calculate operating income for the period.

Problem-8- Mcgraw hill connect accounting answers chapter 4

Net income was $224,600 for the year. Throughout the year the company had outstanding 16,000 shares of $2.00, $100 par value preferred stock and 107,000 shares of common stock.

Required:

Calculate basic earnings per share of common stock for the year. (Round “Earnings per share-basic” to 2 decimal places.)

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