UBL Financial Group provides personal and commercial banking, wealth management services, insurance, and corporate and investment banking. On March 3, 2017, the company announced that its board of directors had declared a stock dividend, which has the same effect as a two-for-one split of its common shares. The board of directors also declared a quarterly common share cash dividend of $0.52 per share, which represents $0.26 per share on a post-stock dividend basis. This dividend of $0.26 per share, as well as the stock dividend, are payable on May 24, 2017, to common shareholders of record on April 25, 2017.
Required: 1. Prepare any journal entries that UBC Financial should make as the result of information in the preceding report. Assume that the company has 1.3 million shares outstanding with a market value of $13.25 per share and an average issue price of $5.60
1. Record declaration of stock dividend
2. Record declaration of cash dividend
3. Recod issuance of shares to current shareholders as common stock dividend
4. Recod payment of cash dividend
1.
UBL Financial Group provides personal and commercial banking, wealth management services, insurance, and corporate and investment banking. On March 3, 2017, the company announced that its board of directors had declared a stock dividend, which has the same effect as a two-for-one split of its common shares. The board of directors also declared a quarterly common share cash dividend of $0.52 per share, which represents $0.26 per share on a post-stock dividend basis. This dividend of $0.26 per share, as well as the stock dividend, are payable on May 24, 2017, to common shareholders of record on April 25, 2017.
Required: 1. Prepare any journal entries that UBC Financial should make as the result of information in the preceding report. Assume that the company has 1.3 million shares outstanding with a market value of $13.25 per share and an average issue price of $5.60
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Related questions
Kohler Corporation reports the following components of stockholdersâ equity on December 31, 2016:
| Common stockâ$15 par value, 100,000 shares authorized, 55,000 shares issued and outstanding | $ | 825,000 |
| Paid-in capital in excess of par value, common stock | 70,000 | |
| Retained earnings | 460,000 | |
| Total stockholders' equity | $ | 1,355,000 |
In year 2017, the following transactions affected its stockholdersâ equity accounts.
| Jan. | 1 | Purchased 6,000 shares of its own stock at $20 cash per share. | ||
| Jan. | 5 | Directors declared a $2 per share cash dividend payable on February 28 to the February 5 stockholders of record. | ||
| Feb. | 28 | Paid the dividend declared on January 5. | ||
| July | 6 | Sold 2,250 of its treasury shares at $24 cash per share. | ||
| Aug. | 22 | Sold 3,750 of its treasury shares at $17 cash per share. | ||
| Sept. | 5 | Directors declared a $2 per share cash dividend payable on October 28 to the September 25 stockholders of record. | ||
| Oct. | 28 | Paid the dividend declared on September 5. | ||
| Dec. | 31 | Closed the $428,000 credit balance (from net income) in the Income Summary account to Retained Earnings. |
Required:
1. Prepare journal entries to record each of these transactions for 2017.
2. Prepare a statement of retained earnings for the year ended December 31, 2017.
3. Prepare the stockholders' equity section of the companyâs balance sheet as of December 31, 2017.
Journal Entries
1. Record the purchase of 6,000 shares of its own common stock for $20 cash per share.
2. Record the declaration of a cash dividend of $2 per share.
3. Record the payment of the cash dividend.
4. Record the reissue of 2,250 shares of the treasury stock for $24 cash per share.
5. Record the reissue of 3,750 shares of the treasury stock for $17 cash per share.
6. Record the declaration of a cash dividend of $2 per share.
7. Record the payment of the cash dividend.
8. Record the entry to close the income summary account having a credit balance of $428,000.
Prepare a statement of retained earnings for the year ended December 31, 2017. (Amounts to be deducted should be indicated by a minus sign.)
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Prepare the stockholders' equity section of the companyâs balance sheet as of December 31, 2017
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| ($ in 000s) | |||
| Common stock, 113 million shares at $1 par | $ | 113,000 | |
| Paid-in capitalâexcess of par | 678,000 | ||
| Retained earnings | 920,000 | ||
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| a. | November 1, 2016, the board of directors declared a cash dividend of $0.50 per share on its common shares, payable to shareholders of record November 15, to be paid December 1. |
| b. | On March 1, 2017, the board of directors declared a property dividend consisting of corporate bonds of Warner Corporation that Branch-Rickie was holding as an investment. The bonds had a fair value of $2.9 million, but were purchased two years previously for $2.5 million. Because they were intended to be held to maturity, the bonds had not been previously written up. The property dividend was payable to shareholders of record March 13, to be distributed April 5. |
| c. | On July 12, 2017, the corporation declared and distributed a 4% common stock dividend (when the market value of the common stock was $21 per share). Cash was paid in lieu of fractional shares representing 520,000 equivalent whole shares. |
| d. | On November 1, 2017, the board of directors declared a cash dividend of $0.50 per share on its common shares, payable to shareholders of record November 15, to be paid December 1. |
| e. | On January 15, 2018, the board of directors declared and distributed a 3-for-2 stock split effected in the form of a 50% stock dividend when the market value of the common stock was $22 per share. |
| f. | On November 1, 2018, the board of directors declared a cash dividend of $0.35 per share on its common shares, payable to shareholders of record November 15, to be paid December 1. |
| Required: |
| 1. | Prepare the journal entries that Branch-Rickie recorded during the three-year period for these transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in whole dollars.)
*****I AM STUCK ON PROBLEM C. I come with 10920000 for my cash but my retained earnings and other parts of the problem are not correct. I need to know where I am going incorrect with this problem. |
