Question 17, P1-9 (book/static)>Part 1 of 5Interest versus dividend income Depot Logistics Inc. has declared pretax income from its operations for the year of $560,000. In addition, it also received an interest payment of $40,000 on bond stock held in Warehouse PLC. During the year. they also received $40,000 in income from dividends on its 20%common stock holding in Zephir PLC. Depot Logistics isa. Calculate the tax liability for Depot Logistics on its operating income.b. Calculate the tax and after-tax income attributable to the interest income received on account of bond stock, from Warehouse PLC.c. Find the tax and after-tax income owing to the dividend income received on account of common stock, from Zephir PLC.d. Compare and comment on the after-tax amounts resulting from the interest income and dividend income calculated in part b and c.e. What is the firm's total tax liability for the year?the 30% tax bracket and is eligible for a 70% dividend exclusion on its Zephir PLC stock.a. The tax liability for Depot Logistics on its operating income is $

“Since you have posted a question with multiple sub-parts, we will solve first three subparts for…

Interest versus dividend income Depot Logistics Inc. has declared pretax income from its operations for the year of $560,000. In addition, it also received an interest payment of $40,000 on bond stock held in Warehouse PLC. During the year. they also received $40,000 in income from dividends on its 20% common stock holding in Zephir PLC. Depot Logistics is in the 30% tax bracket and is eligible for a 70% dividend exclusion on its Zephir PLC stock. a. Calculate the tax liability for Depot L b. Calculate the tax and after-tay ncom on it operating income. c. Find the tax and after-tax income owing to the dividend income received on account of common stock, from Zephir PLC d. Compare and comment on the after-tax attributable to the interest income received on account of bond stock, from Warehouse PLC. r the year? a. The tax liability for Depot Logistics on its operating income is $

Interest versus dividend income Depot Logistics Inc. has declared pretax income from its operations for the year of $560,000. In addition, it also received an interest payment of $40,000 on bond stock held in Warehouse PLC. During the year. they also received $40,000 in income from dividends on its 20% common stock holding in Zephir PLC. Depot Logistics is in the 30% tax bracket and is eligible for a 70% dividend exclusion on its Zephir PLC stock. a. Calculate the tax liability for Depot L b. Calculate the tax and after-tay ncom on it operating income. c. Find the tax and after-tax income owing to the dividend income received on account of common stock, from Zephir PLC d. Compare and comment on the after-tax attributable to the interest income received on account of bond stock, from Warehouse PLC. r the year? a. The tax liability for Depot Logistics on its operating income is $

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter21: Corporations: Taxes, Earnings, Distributions, And The Statement Of Retained Earnings

Section: Chapter Questions

Problem 8SPA

See similar textbooks

Similar questions

Selected transactions completed by Equinox Products Inc. during the fiscal year ended December 31, 2016, were as follows: a. Issued 15,000 shares of 20 par common stock at 30, receiving cash. b. Issued 4, 000 shares of 80 par preferred 5% stock at 100, receiving cash. c. Issued 500,000 of 10-year, 5% bonds at 104, with interest payable semiannually. d. Declared a quarterly dividend of 0.50 per share on common stock and 1.00 per share on preferred stock. On the date of record, 100,000 shares of common stock were outstanding, no treasury shares were held, and 20,000 shares of preferred stock were outstanding. e. Paid the cash dividends declared in (d). f. Purchased 7,500 shares of Solstice Corp. at 40 per share, plus a 150 brokerage commission. The investment is classified as an available-for-sale investment. g. Purchased 8,000 shares of treasury common stock at 33 per share. h. Purchased 40,000 shares of Pinkberry Co. stock directly from the founders for 24 per share. Pinkberry has 125,000 shares issued and outstanding. Equinox Products Inc. treated the investment as an equity method investment. i. Declared a 1.00 quarterly cash dividend per share on preferred stock. On the date of record, 20,000 shares of preferred stock had been issued. j. Paid the cash dividends to the preferred stockholders. k. Received 27,500 dividend from Pinkberry Co. investment in (h). l. Purchased 90,000 of Dream Inc. 10-year, 5% bonds, directly from the issuing company, at their face amount plus accrued interest of 37 5. The bonds are classified as a held-to-maturity long -term investment. m. Sold, at 38 per share, 2,600 shares of treasury common stock purchased in (g). n. Received a dividend of 0 .60 per share from the Solstice Corp. investment in (f). o. Sold 1,000 shares of Solstice Corp. at 45, including commission. p. Recorded the payment of semiannual interest on the bonds issue d in (c) and the amortization of the premium for six months. The amortization is determined using the straight-line method . q. Accrued interest for three months on the Dream Inc. bonds purchased in (I). r. Pinkberry Co. recorded total earnings of 240 ,000. Equinox Products recorded equity earnings for its share of Pinkberry Co. net income. s. The fair value for Solstice Corp. stock was 39. 02 per share on December 31, 2016. The investment is adjusted to fair value , using a valuation allowance account. Assume Valuation Allowance for Available-for-Sale Investments h ad a beginning balance of zero. Instructions 1. Journalize the selected transactions. 2. After all of the transaction s for the year ended December 31, 201 6, had been poste d [including the transactions recorded in part (1) and all adjusting entries), the data that follows were taken from the records of Equinox Products Inc. a. Prepare a multiple-step in come statement for the year ended December 31, 201 6, concluding with earnings per share . In computing earnings per share, assume that the average number of common shares outstanding was 100,000 and preferred dividends were 100,000. ( Round earnings per share to the nearest cent.) b. Prepare a retained earnings statement for the year ended December 31, 20 6. c. Prepare a balance sheet in report form as of December 31, 2016.
Given the following year-end information, compute Greenwood Corporations basic and diluted earnings per share. Net income, 15,000 The income tax rate, 30% 4,000 shares of common stock were outstanding the entire year. shares of 10%, 50 par (and issuance price) convertible preferred stock were outstanding the entire year. Dividends of 2,500 were declared on this stock during the year. Each share of preferred stock is convertible into 5 shares of common stock.
Using the following information for the year ended 30 June, prepare the Retained Earnings Account for Kramer Ltd. Retained earnings as at 1 July $450,000 Transfer from Dividend Equalisation Reserve $200,000 Operating Profit (before income tax expenses $270,000) $900,000 Create a provision for dividend of 15 cents per share. There are 7,500,000 shares issue
Question 28, P1-9 (similar to) Part 1 of 5 Interest versus dividend income Last year, Shering Corporation had pretax earnings of $480,000. In addition, during the year it received $21,000 in income from interest on bonds it held in Zig Manufacturing and received $21,000 in income from dividends on its 6% common stock holding in Tank Industries, Inc. Shering faces a flat 21% tax rate and is eligible for a 50% dividend exclusion on its Tank Industries stock. a. Calculate the firm's tax on its operating earnings only. b. Find the tax and the after-tax amount attributable to the interest income from Zig Manufacturing bonds. c. Find the tax and the after-tax amount attributable to the dividend income from the Tank Industries, Inc., common stock. d. Compare, contrast, and discuss the after-tax amounts resulting from the interest income and dividend income calculated in parts b. and c. e. What is the firm's total tax liability for the year? a. The tax on operating earnings is $ (Round to the…
The equity section of Whispering Inc. at January 1, 2022, was as follows. Share capital-ordinary $390,000 Accumulated other comprehensive income Unrealized holding gain on equity securities designated at fair value through other comprehensive income 65,000 Retained earnings 26,000 During the year, the company had the following transactions. 1. Issued 13,000 shares at $3 per share. 2. Dividends of $12.200 were declared and paid. 3. Net income for the year was $130,000. Unrealized holding loss of $6,500 occurred on its equity securities designated at fair value through other comprehensive 4. income. Prepare a statement of changes in equity for Whispering Inc. WHISPERING INC.
Required information [The following information applies to the questions displayed below.] The financial statements for Highland Corporation included the following selected information: Common stock Retained earnings Net income Shares issued Shares outstanding Dividends declared and paid The common stock was sold at a price of $36 per share. Required: 1. What is the amount of additional paid-in capital? $ 515,000 $ 890,000. Additional paid-in capital $ 1,110,000 103,000 64,000 $ 770,000
Exercise 6-4 (Cash, Share Capital, and Property Dividends) The PQR Corporation reports the following balances of January 1, 2021: P50,000 Ordinary share capital, P25 par, 2,000 shares outstanding Ordinary share premium Retained earnings 20,000 150,000 The following dividend declarations were made during the year: Mar 15 Declared a cash dividend of P6 per share payable on April 15 to shareholders of record of March 31. July 15 Declared as dividends the stocks of Pentagon Corp. owned by PQR Corp. One share of Pentagon Corp. stock will be distributed for every share of PQR Corp. stock owned. The stocks of Pentagon have a carrying value of P25 per share. Oct 15 Declared a 30% stock dividend distributable on December 1 to shareholders of record of November 15. Stocks are selling on this date at P45 per share. Instructions: Record the declaration and distribution of the above dividends. ♡ Share Favourite Delete Edit More a O O
The following information has been extracted from the published accounts of Pesa Corporation Limited, a company quoted on the Nairobi Stock Exchange. Shs. Net profit after tax and interest 990,000 Less: dividends for the period 740,000 Transfer to reserves 250,000 Accumulated reserves brought forward 810,000 Reserves carried forward 1,060,000 Share capital (Sh.10 par valu Sh.8,000,000 Market price per share now 12% RequiredCalculate…
Exercise 6-2 (Cash and Share Capital Stock Dividends) The statement of financial position of JKL Corp. as of December 31, 2020 reports the following shareholder equity accounts: Ordinary Share Capital, P50 par, 100,000 shares outstanding Ordinary Share Premium Retained Earnings P5,000,000 2,500,000 3,000,000 During 2021, the following dividend distributions were made: April 1 Declared a cash dividend of P7 per share payable on May 2 to shareholders of record of April 15. June 1 Decdared a 10% stock dividend distributable on July 15 to shareholders of record of June 30. Stocks are selling on this date at P65 per share Instructions: Record the declaration and distribution of each of the above-mentioned dividends. Share Favourite Delete Edit More ... 归 0
on the preference shares. The net income for the current 1. What amount should be reported as basic earnings per issued 500,000 preference shares which were convertible into 2,000,000 ordinary shares outstanding. On July 1, the entity Problem 20-14 (IAA) During the year, the entity declared and paid P1,000,000 cash dividend on the ordinary shares and P800,000 cash dividend A the beginning of current year, Frown Company had S000,000 ordinary shares outstanding. On July 1, the entity 300,000 ordinary shares. Year was P6,500,000. share? a. 2.85 b. 3.25 С. 2.35 d. 2.25 per share? а. 2.85 b. 3.02 с. 2.83 d. 1.75 633
please prepare the journal entries Q1. Sold 22,500 Treasury shares at $2 each. Q2. Purchased 10% shareholding in Charlie Limited, a supplier, as a long-term investment. The fair value of the 10% shareholding was $2,900,000 as at 1 March. The purchase consideration included a $2,700,000 note receivable due from Charlie Limited and the related interest receivable balance of $144,000, $140,000 cash and a motor vehicle owned by ITI. The motor vehicle was originally obtained at $120,000. ( for depreciation details, refer to Q1 of additional information.) Q3. A 10% share dividend was declared when the market value per share was $2.1. Q4. Paid cash to acquired 30,000 shares of its own at $2.3 each. ITI intends to keep the shares for several months for management bonus.
uhe beginning of current year, Jade Company reported the following sharcholders' equity: Share capital, 1,500,000 shares Share premium Retained carnings Treasury shares, 100,000 at cost 1,500,000 I5,000,000 8,100,000 ( 900,000) All of the outstanding and treasury shares were originally issued for PIl per share. During the current year, the following events or transactions occurred relating to shareholders' equity: • February 15- Issued 400,000 shares for P12.50 per share. • June 15 - Declared a cash dividend of PO.20 per share to shareholders of record on April 1 and payable on April 15. This was the first dividend ever declared. • September 15- The president retired. The entity purchased from the retiring president 100,000 shares for P13.00 per share which was equal to market value on this date. These shares were canceled. • December 15 - Declared a cash dividend of PO.20 per share payable carly next year. * Atcurrent year-end, the entity is being sued by two separate parties for…