For Each of the Following Independent Transactions a Through D,prepare

question 172

Essay

For each of the following independent transactions a through d,prepare the necessary journal entry:
(a)Declared a $0.40 per share cash dividend on 200,000 shares of preferred stock outstanding.
(b)Declared and distributed a 12% stock dividend on 800,000 shares of $5 par value common stock outstanding.Market price per common share on this date was $25.
(c)Declared and distributed a 2-for-1 stock split on 500,000 shares of $10 par value common stock outstanding.
(d)Declared and distributed a 30% stock dividend on 400,000 common shares of $5 par value common stock outstanding.Market price per common share on this date was $20.

Calculate and interpret the average rate of return for investment projects.

Understand and apply the concept of the time value of money in investment decisions.

Identify and calculate the net present value (NPV) of investment proposals.

Calculate and understand the importance of the cash payback period in investment decisions.

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Definitions:

Ambiguous Genitalia

A condition where an individual's external genitalia do not appear clearly male or female, complicating sex determination at birth.

5-alpha Reductase Deficiency

A rare genetic condition where the body lacks or has insufficient amounts of the enzyme needed to convert testosterone into dihydrotestosterone, affecting male sexual development before birth and during puberty.

Dihydrotestosterone

A potent androgen hormone responsible for the development of male characteristics.

5-alpha Reductase Deficiency

A genetic condition that affects male sexual development, leading to atypical genitalia at birth.