Declaration and payment of the cash dividend

Reference no: EM131118269

Assume that John Deere Co. issues 2,000 shares of $100 par, 6% convertible preferred stock for $105 per share. Shareholders have the right to exchange each share of convertible preferred stock for five shares of $10 par common stock. Use the template below to show the financial statement effects of the following events.
a. Issuance of the preferred stock.
b. Declaration and payment of the cash dividend on the preferred stock.
c. Conversion of the preferred stock to common stock when the market value of the common stock is $29 pershare.

Reference no: EM131118269

Questions Cloud

What is typically common about all financial statement : Provide several examples of financial statement accounts that are often loosely referred to as reserves. What is typically common about all financial statement accounts that are informally referred to as reserves?

The effects of the two reporting techniques on the financial : The effects of the two reporting techniques on the financial statements differ substantially. From the perspective of the lessee, prepare a chart that lists the line items reported on the (a) Income statement, (b) Balance sheet (c) Statement of cash ..

Describe the applicable criteria to determine : Should the firms recognize a liability in the amount of the cash received for the receivables? Describe the applicable criteria to determine whether the transfer of receivables can be recorded as a sale.

Describe the two criteria and provide an example : The text states that loss contingencies may or may not give rise to accounting liabilities. Financial reporting requires firms to recognize a loss contingency when two criteria are met. Describe the two criteria and provide an example in which applyi..

Declaration and payment of the cash dividend : Issuance of the preferred stock. Declaration and payment of the cash dividend on the preferred stock. Conversion of the preferred stock to common stock when the market value of the common stock is $29 pershare.

Redemption will occur at a specific time or upon a specific : Determine and compare the financial reporting (debt versus equity classification) of redeemable preferred stock with the following characteristics under U.S. GAAP and IFRS. Redemption will occur at a specific time or upon a specific event .

Show the financial statement effects of the debt settlement. : The investments are worth $135,000 at the date of the debt settlement. Use the template below to show the financial statement effects of the debtsettlement.

Use the template below to show the financial statement effec : Use the template below to show the financial statement effects of (1) The December 31, 2010 issue (2) The December 31, 2011 interest payment and interest expense accrual

State none if there is no cash flow effect issuance of stock : Identify where the cash flow effect of each of the following transactions is reported in the statement of cash flows: operating, investing, or financing section. State the direction of each change. State None if there is no cash flow effect. Issuance..

User Account

All Pages