"Distributions" There are many types of distributions a company can make: dividends, noncash property, and stock....
"Distributions" There are many types of distributions a company can make: dividends, noncash property, and stock. Select a type of distribution and explain the impact the distribution will have on the corporation and its shareholders, as well as the impact the distribution may have on Earnings and Profit.
Homework Answers
Select a type of distribution and explain the impact the distribution will have on the corporation and its shareholders, as well as the impact the distribution may have on Earnings and Profit?
Answer: Yes, there are several types of distributions in which stock dividend is one type of dividend in which dividend is issued in the form of stock meaning shares to the stockholders at the value decided.
Company may decide to issue stock for the dividend when there has been short supply of liquid cash in the company. Stock dividend have a tax advantage that is these are not taxed until the shares are sold by an investor.
This type of distribution will have an increase in share capital of corporation for both corporation and shareholders in which one be lianility and the other is asset to the party involved. The corporation stock increases with a respective decrease in retained earnings.
This type of distribution normally doesnt effect earnings and profit except in the circumstance where there is less retained earnings which means profit for the year is high.
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"Distributions" There are many types of distributions a company
can make: dividends, noncash property, and stock....
is used? Impact of Cash and Stock Dividends LOL.3 The account balances for the noncash current...
is used? Impact of Cash and Stock Dividends LOL.3 The account balances for the noncash current assets and current liabilities of Abraham Music Company are as follows: December 31 2011 2012 Dividends payable $50,000 $ 40,000 Retained earnings 545,000 375,000 Other information for 2011: a. Abraham reported $375,000 in net income for 2011. b. The company declared and distributed a stock dividend of $85,000 during the year. c. The company declared cash dividends at the end of each quarter and...
XYZ Corporation distributed to its shareholders a total of $30,000 in cash plus property that had...
XYZ Corporation distributed to its shareholders a total of $30,000 in cash plus property that had a fair market value of $80,000 and a basis of $60,000. The corporation’s earnings and profits were $100,000 on the last day of the year in which the distribution was made after taking into effect the impact on the corporation’s earning and profits of the gain recognized on the distribution (but before reducing earnings and profits by the fair market value of the distribution)....
— 3. In the current year, Warbler Corporation (E&P of $250,000) made the following property distributions...
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A firm's value depends on its expected free cash flow and its cost of capital. Distributions...
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sarah Canvas → XCO Question 8 All of the following statements regarding stock redemptions are true...
sarah
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What is the significance of a constructive dividend? n for O A. A constructive dividend is...
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26. Identify which of the following statements is true. A) A liquidating distribution of property other...
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Part XIII: Account for the issuance of stock A company neither _____________________________ nor _________________________ when it...
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XYZ company has the following: –Stock market price, December 31, 2018: $80 –Common stock ($5 par):...
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is used? Impact of Cash and Stock Dividends LOL.3 The account balances for the noncash current assets and current liabilities of Abraham Music Company are as follows: December 31 2011 2012 Dividends payable $50,000 $ 40,000 Retained earnings 545,000 375,000 Other information for 2011: a. Abraham reported $375,000 in net income for 2011. b. The company declared and distributed a stock dividend of $85,000 during the year. c. The company declared cash dividends at the end of each quarter and...
— 3. In the current year, Warbler Corporation (E&P of $250,000) made the following property distributions to its shareholders (all corporations): Fair Market Adjusted Basis Value Pink Corporation stock (held for investment) $150,000 $120,000 Non-LIFO inventory 80,000 110,000 Warbler Corporation is not a member of a controlled group. As a result of the distribution: a. The shareholders have dividend income of $200,000. b. The shareholders have dividend income of $260,000. c. Warbler has a recognized gain of $30,000 and a...
A firm's value depends on its expected free cash flow and its cost of capital. Distributions made in the form of dividends or stock repurchases Impact the firm's value and the investors in different ways. In some cases, analysts notice that groups of similar investors tend to flock to stocks that have dividend policies consistent with their financial needs. This circumstance is an illustration of: the residual dividend policy. the signaling hypothesis. dividend irrelevance theory. the clientele effect. Consider the...
sarah
Canvas → XCO Question 8 All of the following statements regarding stock redemptions are true except A redemption occurs when a corporation reacquires its stock in exchange for property. The term property includes money, securities, and any other property except stock or stock rights in the distributing corpo The stock that is redeemed by a corporation may not be held as treasury stock Redemptions that are not complete or partial liquidations can be distributions in part or full payment...
What is the significance of a constructive dividend? n for O A. A constructive dividend is a dividend that is given some other label by the parties. For example a dividend maybe we compensation such amounts we rec ed e ndis for Thu compensation would be disabled payment were rected as added O B. A constructive dividend is a distribution by a regulated investment company realized from the sale of investments. Such dividendo ho include any underbated capital and located...
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