Green Day Co Case Study

Green Day Co has 400,000 C/S $10 par value shares outstanding. Company declared a 5% stock dividend when the market price of stock = $65/share

1. J/E – Date of declaration

20,000 shares x $65 = $ 1,300,000

R/E 1,300,000

        C/S div distributable

        APIC 1,100,000

J/E -- DATE OF ISSUANCE

C/S Div Disttributable 200,000

        C/S                        200,000

Note: The par value goes in c/s div distributable

Green Day Co has 400,000 C/S $10 par value shares outstanding. Company declared a 100% stock dividend when the market price of stock = $65/share

1. J/E – Date of declaration

R/E 1,300,000

        C/S div distributable

        APIC 1,100,000

40000 shares of c/s outstanding, p/s div= $5,000 AND NET i..(pic*)

EPS = (Net Income – P/S Dividends) / weighted avg c/s outstanding “wacso”
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Warrants can be traded

DUE HW DUE CH16 @ 5pm

Evans Corp stock is traded on NASDAQ; Bonds have a readily determinable FMV. Company issued 10,000 units of lump security (1$500 par, 12% bond + 10 shares at c/s each)

Bond=par        $880 x 10,000= $8,800,000

1. Proportional

FMV                        PROPORTION                PROCEED ALLOCATION

Bonds                 $500X$1=$500        500/900=56%                $4,888,889

C/S                $40X10shares=400         400/900= 44%                $3,911,111

                                                                $8,800,000

Cash                 8800000

Discount b/p        111111

        b/p                        5000000 OR 3?

        C/S                        500,000

        P/C                        3411111

check12:20

1. Incremental

Cash 8,800,000        

        b/p  5000000

        c/s500000

        p/c3300000