ACCT 3211 Assignment #2

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School
Humber College **We aren't endorsed by this school
Course
ACCT 3211
Subject
Accounting
Date
Oct 28, 2023
Pages
4
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ACCT 3211 Assignment #2 Yahye Ahmed T00742115 October 20, 2023 Question 1 Date Account Title Debit Credit May 30, Year 6 Cash (15,000*$62*40%) 372,000 Subscription Receivable 558,000 Subscribed Share Capital 930,000 May 30, Year 6 Cash (15,000*$62*40%) 372,000 Share Subscription Payable 372,000 September 30, Year 6 Cash (15,000*$62*60%) 558,000 Share Subscription Payable 558,000 Share Subscriptions Payable 930,000 Common Shares (15,000*$62) 930,000 Question 2 Date Accounts title Debit Credit September 23 Treasury Shares(100,000*$13) $1,300,000 Cash $1,300,000
Common Shares $900,000 Retained Earnings $400,000 Treasury Shares $1,300,000 Contributed Surplus $78,000 Retained Earnings $1,222,000 Common Shares $1,300,000 Question 3 a. 20,000*0.80=16,000 16,000*2 years= 32,000 32,000 in dividend arrears Add Year 6 dividend which is 16,000 32,000+16,000=$48,000 So total Dividends is $48,000 b. 10,000*3*2=60,000 for being cumulative 420,000-60,000=360,000 60,000*3=180,000 360,000-180,000=180,000 balance Preferred Shares= 180,000*250,000/1,500,000= $30,000 for being fully participating Common Shares= 180,000*1,250,000/1,500,000= 150,000 $60,000+$30,000=$90,000 Question 4: January 1, Outstanding shares= 800,000 Less, Shares Repurchased 100,000 800,000-100,000=700,000 Outstanding Shares in May 31 700,000+200,000=900,000 Outstanding Shares in July 31 900,000*2=1,800,000 Outstanding Shares in Sept 1 1,800,000+200,000=2,000,000 Outstanding Shares in Oct 31
Date Number of Shares Restatement(stock split and stock dividends) Months Outstanding and months in a year Weighted Value January 1 800,000 2 5/12 666,666.67 May 31 700,000 2 2/12 (233,333.33) July 31 900,000 2 1/12 150,000 September 1 1,800,000 2/12 300,000 October 31 2,000,000 2/12 333,333.33 1,216,666.67 Weighted average number of shares for 2023 is 1,216,666.67 Question 5: Net Income= $1,000,000 Preferred Dividends= 25,000 shares * $3.20= $80,000 Weighted Average Common Shares= 250,000 Basic Earnings Per Share= ($1,000,000-$80,000)/(250,000)=$3.68 Stock Options= 50,000*$38= $1,900,000/53 average=35,849 shares Exercising Options= 50,000-35,849= 14,151 shares Convertible bonds into 25 shares Total number of bonds= $3,000,000/$1,000=3,000 bonds 3,000 bonds * 25 shares= 75,000 shares Interest Expense to income net of tax=($3,000,000*0.06)*(1-0.30)= $126,000 Diluted EPS= (($920,000+$126,000-$80,000)/(250,000+14,151+75,000+25,000) =$3.08 Numerator Denominator EPS Basic $920,000 250,000 3.68 Options 0 14,151 $920,000 264,151 3.48 Bonds 126,000 75,000 $1,046,000 339,151 3.08 Preferred $80,000 25,000
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