Chapter 10 smartbook 2

The purpose of the statement of shareholders' equity is to

report the changes and the sources of the changes in shareholder equity accounts

When a company declares and pays a cash dividend, what are the financial statement effects?

stockholders equity decreases

Which of the following will change the balance of a stockholders' equity account category

Cash dividends Treasury stock is resold at cost Preferred stock is issued

On April 1, 2018, Rawlings declares a dividend of $0.30 per share. Rawlings has 100,000 shares authorized, and 40,000 issued and outstanding. The date of record is April 28, and the payment date is May 15. Which of the following entries is included in the journal entry on May 15?

Debit dividends payable $12,000.

When a cash dividend is declared and paid in the same year, the total effects on the balance sheet include which of the following?

Decrease assets. Decrease stockholders' equity.

earned capital is?

Retained earnnings

The journal entry to record the declaration of a dividend includes ____

a debit to Dividends a credit to Dividends payable

Retained earnings are

all of the company's earnings not distributed to stockholders. increased by net income. decreased by dividends. sometimes called earned capital

Dividends ______ paid on treasury shares.

are not

invested capital is?

common stock

The market value of equity is equal to the product of these two factors

current stock price number of shares outstanding

Dividends payable is recorded as a credit on the

declaration date.

The effect on the accounting equation of declaring a dividend that will be paid at a later date includes a(n)

decrease in stockholders' equity. increase in liabilities.

A corporation's accumulated income that has not been distributed as dividends to shareholders is referred to as

retained earnnings

a companys past profits that are not paid out in dividends are?

retained earnnings

If we multiply the current stock price per share and the number of shares outstanding, we will be able to calculate _______ value of equity.

market