Submitted by: Submitted by oreobluehappy
Views: 718
Words: 257
Pages: 2
Category: Business and Industry
Date Submitted: 10/13/2012 06:01 AM
Problem 9-1
a.
with current liablilities
Debt equity ratio
97,920/146880 = 66.7%
Excluding current liabilities
With out current liabilities
73,440/146,880= 50%
Debt capitalization ratio
73,440/220320= 33%
b.
Debt Equity ration and Debt capitalization ratio measure of funds the company has borrowed from creditors opposite to owners. It indicates the total capital structure the company has. It also shows the risk of borrowings with fix debt and analize how to increase the profitability with the shareholders.
Problem 9-2
Basic earnings per share
19,550,000-3,900,000/2,000,000= 7.83
Diluted earnings per share
19,550,000-3,900,000/2,000,000+(200,000-100,000)= 7.45
Problem 9-5
1.
Preferred Stock 1,200,000
Retained earnings 168,000
Cash 1,368,000
2.
Preferred Stocks Dividend 224,000
Dividend Payable 224,000
3.
Common Stock Dividend 1,500,000
Dividend Payable 1,500,000
Problem 9-7
a. April 15
Cash 1,500,000
Common Stock 1,500,000
b. December 21
Retained Earnings 400,000
Paid in Capital 400,000
c. July 1
Cash 900,000
Common Stock 900,000
d. November 15
Treasury Stock 420,000
Cash 420,000
e. December 15
Cash 230,000
Treasury Stock 210,000
Paid-in Capital 20,000
f. Sept 15
Cash 175,000
Paid in capital 35,000
Treasury stock 210,000
g. Dec 24
Retained earnings 150,000
Dividends payable 150,000
h. Jan 24
Dividends payable 150,000
Cash 150,000