TAILIEUCHUNG - Lecture Accounting principles (12th Edition): Chapter 14 - Weygandt, Kimmel, Kieso

Chapter 14 - Corporations: Dividends, retained earnings, and income reporting. In this chapter, the learning objectives are: Explain how to account for cash dividends, explain how to account for stock dividends and splits, prepare and analyze a comprehensive stockholders’ equity section. | Corporations: Dividends, Retained Earnings, and Income Reporting 14 Learning Objectives Explain how to account for cash dividends. Explain how to account for stock dividends and splits. Prepare and analyze a comprehensive stockholders’ equity section. 3 2 1 Describe the form and content of corporation income statements. 4 Distribution of cash or stock to stockholders on a pro rata (proportional to ownership) basis. Types of Dividends: Cash dividends. Property dividends. Dividends are generally reported quarterly as a dollar amount per share. Stock dividends. Scrip (promissory note). LO 1 LEARNING OBJECTIVE Explain how to account for cash dividends. 1 For a corporation to pay a cash dividend, it must have: Retained earnings - Payment of cash dividends from retained earnings is legal in all states. Adequate cash. A declaration of dividends by the Board of Directors. Cash Dividends LO 1 Three dates are important: Illustration 14-1 Key dividend dates LO 1 Cash Dividends Illustration: On Dec. 1, the directors of Media General declare a 50 cents per share cash dividend on 100,000 shares of $10 par value common stock. The dividend is payable on Jan. 20 to shareholders of record on Dec. 22. Dec. 1 (Declaration Date) Cash Dividends 50,000 Dividends Payable 50,000 Dec. 22 (Date of Record) Jan. 20 (Payment Date) Dividends Payable 50,000 Cash 50,000 No entry LO 1 Cash Dividends Right to receive dividends before common stockholders. Per share dividend amount is stated as a percentage of the preferred stock’s par value or as a specified amount. Cumulative Dividend Preferred stockholders must be paid both current-year dividends and any unpaid prior-year dividends before common stockholders receive dividends. Dividend Preferences LO 1 CUMULATIVE DIVIDEND Illustration: Scientific Leasing has 5,000 shares of 7%, $100 par value, cumulative preferred stock outstanding. Each $100 share pays a $7 dividend (.07 x $100). The annual dividend is $35,000 (5,000 x $7 per share). If dividends

• Kế toán - Kiểm toán
• Accounting principles
• Lecture Accounting principles
• Nguyên lý kế toán
• Cash dividends
• Retained earnings
• Income reporting
• Fundamental accounting principles
• Lecture Fundamental accounting principles
• Accounting information systems
• Fundamental system principles
• Technology based accounting systems
• Accounting information
• Financial accounting
• Managerial accounting
• Managerial cost
• Reporting manufacturing activities
• Merchandising operations
• Accounting cycle
• Completing the accounting cycle
• Classified balance sheet
• Accounting for partnerships
• Partnership form of organization
• Basic partnership accounting