Reference no: EM131211311
Otis Thorpe Corporation has 10,490 shares of $100 par value, 5% preferred stock and 52,400 shares of $10 par value common stock outstanding at December 31, 2014.
Answer the questions in each of the following independent situations.
(a) If the preferred stock is cumulative and dividends were last paid on the preferred stock on December 31, 2011, what are the dividends in arrears that should be reported on the December 31, 2014, balance sheet? How should these dividends be reported?
(b) If the preferred stock is convertible into 7 shares of $10 par value common stock and 3,800 shares are converted, what entry is required for the conversion assuming the preferred stock was issued at par value? (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
(c) If the preferred stock was issued at $106 per share, how should the preferred stock be reported in the stockholders’ equity section? (Enter account name only and do not provide descriptive information.)
|
Assume straight-line amortization
: Cramer Company sold five-year, 8% bonds on October 1, 2016. The face amount of the bonds was $100,000, while the issue price was $102,000. Interest is payable on April 1 of each year. The fiscal year of Cramer Company ends on December 31. How much in..
|
|
Uses straight-line amortization
: Nickel Inc. bought $600,000 of 3-year, 8% bonds as an investment on December 31, 2015 for $648,000. Nickel uses straight-line amortization. On May 1, 2016, $120,000 of the bonds were redeemed at 120. As a result of the retirement, Nickel will report ..
|
|
Uses straight-line amortization
: On January 1, 2016, Solo Inc. issued 1,400 of its 10%, $1,000 bonds at 99. Interest is payable semiannually on January 1 and July 1. The bonds mature on January 1, 2026. Solo paid $65,000 in bond issue costs. Solo uses straight-line amortization. The..
|
|
Recently inherited a trust fund from a distant relative
: Sherry Rudd recently inherited a trust fund from a distant relative. On January 2, the bank managing the trust fund notified Rudd that she has the option of receiving a lump sum check for $200000 or leaving the money in the trust fund and receiving a..
|
|
Preferred stock is cumulative and dividends were last paid
: Otis Thorpe Corporation has 10,490 shares of $100 par value, 5% preferred stock and 52,400 shares of $10 par value common stock outstanding at December 31, 2014. If the preferred stock is cumulative and dividends were last paid on the preferred stock..
|
|
Why do business managers prefer stable earnings trends
: One reason accounting earnings might not be a realistic measure of economic income is the incentive and ability of business managers to manipulate reported pro?ts for their own bene?t. This may be particularly true when their company has an incentive..
|
|
What is break-even point in unit sales and in dollar sales
: Lindon Company is the exclusive distributor for an automotive product that sells for $33.00 per unit and has a CM ratio of 30%. The company’s fixed expenses are $198,990 per year. What are the variable expenses per unit? What amount of unit sales and..
|
|
Calculate the companys cost of goods sold
: Inventory Costing Methods A company with no inventory buys the following three inventory items: The company uses a perpetual inventory system. Required: Calculate the company's cost of goods sold under the following inventory costing methods.
|
|
How much was the cost goods manufactured
: Sydney Incorporation produced wooden tables. It reported the following data for 2015: Materials: Beginning inventory of wood $ 200000 Purchases of wood $616000 Ending inventory of wood $104000 manufacturing labor cost (those assembling and polishing ..
|