Accounting question on dividends

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Business Finance

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Accounting question for wileyplus

Marin Company was formed on July 1, 2015. It was authorized to issue 306,400 shares of $10 par value common stock and 101,400 shares of 7% $25 par value, cumulative and nonparticipating preferred stock. Marin Company has a July 1–June 30 fiscal year.

The following information relates to the stockholders’ equity accounts of Marin Company.

Common Stock
Prior to the 2017–2018 fiscal year, Marin Company had 111,200 shares of outstanding common stock issued as follows.

1.

81,900 shares were issued for cash on July 1, 2015, at $30 per share.

2.

On July 24, 2015, 5,000 shares were exchanged for a plot of land which cost the seller $68,100 in 2009 and had an estimated fair value of $220,900 on July 24, 2015.

3.

24,300 shares were issued on March 1, 2016, for $41 per share.


During the 2017–2018 fiscal year, the following transactions regarding common stock took place.

November 30, 2017

Marin purchased 1,900 shares of its own stock on the open market at $37 per share. Marin uses the cost method for treasury stock.

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Marin Company was formed on July 1, 2015. It was authorized to issue 306,400 shares of $10 par value common stock and 101,400 shares of 7% $25 par value, cumulative and nonparticipating preferred stock. Marin Company has a July 1–June 30 fiscal year. The following information relates to the stockholders’ equity accounts of Marin Company. Common Stock Prior to the 2017–2018 fiscal year, Marin Company had 111,200 shares of outstanding common stock issued as follows. 1. 81,900 shares were issued for cash on July 1, 2015, at $30 per share. 2. On July 24, 2015, 5,000 shares were exchanged for a plot of land which cost the seller $68,100 in 2009 and had an estimated fair value of $220,900 on July 24, 2015. 3. 24,300 shares were issued on March 1, 2016, for $41 per share. During the 2017–2018 fiscal year, the following transactions regarding common stock took place. November 30, 2017 Marin purchased 1,900 shares of its own stock on the open market at $37 per share. Marin uses the cost method for treasury stock. December 15, 2017 Marin declared a 5% stock dividend for stockholders of record on January 15, 2018, to be issued on January 31, 2018. Marin was having a liquidity problem and could not afford a cash dividend at the time. Marin’s common stock was selling at $47 per share on December 15, 2017. June 20, 2018 Marin sold 540 shares of its own common stock that it had purchased on November 30, 2017, for $20,100. Preferred Stock Marin issued 43,600 shares of preferred stock at $48 per share on July 1, 2016. Cash Dividends Marin has followed a schedule of declaring cash dividends in December and June, with payment being made to stockholders of record in the following month. The cash dividends which have been declared since inception of the company through June 30, 2018, are shown below. Declaration Date Common Stock Preferred Stock 12/15/16 $0.30 per share $1 per share 6/15/17 $0.30 per share $1 per share 12/15/17 $1 per share No cash dividends were declared during June 2018 due to the company’s liquidity problems. Retained Earnings As of June 30, 2017, Marin’s retained earnings account had a balance of $657,300. For the fiscal year ending June 30, 2018, Marin reported net income of $38,100. Prepare the stockholders’ equity section of the balance sheet, for Marin Company as of June 30, 2018, as it should appear in its annual report to the shareholders. (Enter account name only and do not provide descriptive information.) MARIN COMPANY Stockholders’ Equity $ $ : $
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