Computing and Journalizing Dividends for Preferred and Common Stock

This paper covers the process of computing and journalizing dividends for both preferred and common stock in financial accounting.

Daniel Kim

Contributor

5.0

5 months ago

Preview (2 of 4 Pages)

100%

Purchase to unlock

Loading page image...

Computing and Journalizing Dividends for Preferred and Common StockP12-32AComputing dividends on preferred and common stock [15–20min]Fashonista Skincare has 10,000 shares of 3%, $20 par value preferred stock and90,000 shares of $2 par common stock outstanding. During a three-year period,Fashionista declared and paid cash dividends as follows: 2010, $3,000; 2011,$13,000; and 2012, $17,000.Requirements1.Compute the total dividends to preferred and to common for each of thethree years ifa.preferred is noncumulative.b.preferred is cumulative.2.For requirement 1.b., journalize the declaration of the 2012 dividends onDecember 22, 2012, and payment on January 14, 2013. Use separate Dividendspayable accounts for preferred and common.(15-20 min.)P 12-32AReq. 1a.Noncummulative:2010 dividend of $3,000:Preferred dividend*$3,000Common dividend0Total dividend$3,000*10,000 x $20 par x 3% = $6,000

Loading page image...

Preview Mode

This document has 4 pages. Sign in to access the full document!

Report

Study Now!

XY-Copilot AI

Unlimited Access

Secure Payment

Instant Access

24/7 Support

Document Chat

Document Details

Subject

Accounting

Related Documents

View all

Class Notes

Accounting

what really is accounting?

5.0

Class Notes

Master Managerial Accounting Techniques

Honors Managerial Accounting course led by Dr. Michael Newman, focusing on cost analysis, ethics, communication, and real-world application through interactive discussions, case studies, and presentations.

Class Notes

Controlling and Reporting of Real Assets

Overview of asset impairment recognition in accounting: when an asset’s value declines due to damage, market loss, or legal issues, a journal entry records the loss to reflect the asset’s reduced value. Key for reporting real assets like PPE.

Solved Assignments