Accounting 2 – ACCT 122 – Program #205 – Corporations (Dividends, Preferred Stock)

Alright, here we are once more. I hope you people
are succeeding. Exactly how was the research? It was not very hard of a task. With any luck
you didn'' t fight with it excessive. So allow ' s go in advance and also dive right in there ok. I think
this was the project was it not. QS 13.1, 13.2, 13.3 and EX13.1 is that? Allow'' s. go on and discuss that. We may do them in a little different order than what you.
did it. It'' s ok. Let ' s do QS 13.1 initial ok. Currently we started discussing the company. type of service. This inquiry states of the adhering to declarations which are
true for the.

business kind of organization.Let ' s go on and place that up there.
What I kind of desire.
Let ' s simply kind of go through these. Real or false for company, possession rights can not be quickly transferred?
they can be easily transferred. Second, proprietors have endless liability for corporate.
financial obligations? That is likewise false. That is one of the big advantages to a corporate form of.
organization is the minimal liability for its owners. Number three, resources is a lot more.
conveniently built up than with many various other kinds of organization.That holds true, obviously you ' re. offering possession in the firm yet it ' s still real. Number 4, corporation earnings. that is dispersed to shareholders
is usually exhausted twice? That is true; let me add a little. long face there, because that ' s the huge downside of a firm. It is a different lawful entity? That holds true; a company is separate lawful entity. A partnership is not a different legal.
entity. Six, it has a restricted life? That is false. And also owners are not representatives of the company? Let me read it once more Owners are NOT agents of the firm? That is true that owners.
are not agents of the company. They can not perform service, for the service. Proprietors.
are not representatives of the firm. That is a real declaration for the business form. We had, let me hop over and workout 13.1 says explain how each of the complying with.
features of companies puts on corporations. This is one more among those.
you can come off of that. This is another one of those that is like, I'' m not 100% certain. I recognize what they'' re requesting here.That ' s reasonable; a few of this really would.
have needed to come from your analysis anyways. Let me go ahead and put the answer up there.
as well as you can just leave it up there while I speak via it. This is all in concerns to.
firms. What regarding owner authority as well as control? Well as you may have reviewed as well as we.
alluded to this. There are shares of stock. Shareholders can elect; common shareholders.
There'' s one ballot per share. The more shares that
you own the more even more you. You have to fill out the documents you have to pay some costs.
you need to adhere to. Number 3, the transferability of ownership; its easily transferred. Currently.
we'' re truly discussing an openly held firm at this moment; one that can be.
bought and offered on the New York Stock Exchange as well as NASDAQ or whatever. The capacity to elevate.
big quantities of capital, there'' s a greater capability with a company, yet once more you'' re.

marketing ownership.The period of life; well its limitless legal rights, it has an unlimited.
life. Even if the proprietor dies the corporation maintains taking place. That makes because, think of.
a business like Pepsi co. who has thousands and hundreds of shareholders. Opportunities are.
There'' s going to be a shareholder that passes away this month or this year? Yet the.
corporation is mosting likely to advance. Proprietor responsibility is limited, that'' s good.Legal status;.
it is a separate legal entity. The tax obligation standing; well it mentions corporate earnings is taxed as well as.
I wear'' t actually care that you memorize. The main thing I want you to recognize it is has the double tax.
any type of concerns on that particular? Otherwise allow'' s do the; I know we still have. a pair quick'research study ' s to do, however allow ' s proceed as well as do the handout; the supply issuance. handout.Prepare the journal entry to videotape system technology ' s issuance of 100,000 shares. of its$ 1 the same level value typical supply assuming the shares offer for.
$ 3 per share? Now remember we are looking from the standpoint of the firm, the.
a person purchasing it. Well you market 100,000 shares for $3 per share. Just how much cash it coming.
in? $300,000, this is why we offered this stock, to increase this resources. We credit ordinary shares,.
If you people like, you guys can abbreviate a little bit. What do we credit scores it for, what.
amount? $100,000, which is the number of shares sold times that arbitrary the same level value or what.
every. That journal access doesn'' t balance so what do you credit scores for $200,000? Extra.
paid in resources. Time I just abbreviate that APIC. Keep in mind these are both equity.
accounts. They are both on the annual report in the equity section. They both have credit history.
balances. The par value simply figures out just how much is attributed to ordinary shares knowledgeables additional.
paid in capital.What if instead the

shares of supply are marketed at $5 per share? Well, cash.
would certainly be debited for $500,000. What would certainly be credit history ordinary shares for? $100,000 and after that.
added paid in resources is attributed for $400,000. Alright, any kind of questions on those.
two? Ok the next one. Prepare the journal entry.
to videotape Kirchoff Inc.'' s issuance of 40,000 shares of$ 5 par worth usual stock assuming. the supply is given in exchange for a structure valued at $370,000. Okay, well it ' s really. very little different than when we market it for the possession of money, except we don ' t debit money. Since we didn ' t obtain cash, right here. We got a different asset called building.
So we debit. building for $370,000. We credit typical stock once again for the variety of shares issued time.
That'' s 200,000. That journal entrance doesn'' t balance, so we attribute additional paid in funding. Okay allow'' s do the last one?
Prepare the journal. entrance to record Celestron Company'' s issuance of 60,000 shares of no-par value supply thinking. the shares offer for$ 20 per share.Now keep in mind some stock does not have a par worth affixed.
to it at all. It'' s no par stock. So this is constantly rather very easy. You debit cash, just how a lot.
cash money can be found in? 60,000 time $20, what is that, 1.2 million. We merely credit report usual.
supply, in parentheses you could put no-par. That'' s the journal access right there.
Any type of. questions on any one of that? PUPIL “” for an examination with the par worth supplies do you want us to.
place the par value with it or otherwise? Like when recalling at right here; like stating ordinary shares.
$ 5 par worth. You wear'' t have to do that; you might locate that in method, I'' m certain the.
Let'' s go in advance as well as do that.That was quick study 13.2 and 13.3. Allow'' s take an appearance at. There is a kind of a glare there isn'' t it?
If they traded for land valued at,$ 29 money per share and also the second circumstance what.
$ 1,827,000. Okay allow me just placed both of those up. I wear'' t assume that ought to have been two.
tough. In the first circumstance you debit cash money for $1,827,000 and also you debt common.
stock, once more if you place no-par value after it that'' s great, you credit ordinary shares for.
$ 1,827,000.

In the 2nd situation, every little thing is the exact same except we don'' t debit cash money we. debit land. Okay let ' s prepared the following one. Quick studies.
13.3, prepare the journal entry to tape-record Zenda Business'' s issuances of 75,000 shares.
of $5 par worth typical supply. Presuming the shares cost, suppose they sell for $5.
a share. Well.
if they offer for $5 per share just how much cash money is available in? It so takes place that in this.
case they cost their par worth. That'' s very, really unusual. After that, if that was the case.
that would be the journal access. There'' s no extra paid in funding over par. By the.
method I advised you last lecture, this is not a law class so were not delving right into all the.
lawful implications of whatever. For your purposes the marketplace worth will certainly constantly be higher.
than the par value. It certainly will never be less. I assume a lawyer told me once.
that if the marketplace value via the supply and demand ever before goes down substandard value some.
lawful ramifications start, however once again we wear'' t really require to be familiar with that.Just.

understand for your purposes par value is never going to be higher than market price. Market.
worth will certainly constantly be higher. What we sell it for will be extra after that the same level. This is what.
Well we debit cash money for $450,000 which is the number of shares released times the market rate. We credit usual stock for $375,000 which is the number of shares released time the par.
They didn'' t use extra. They say paid in funding. We had that slide last time that said you'' re going to see some various.
accounts that look rather comparable. They'' re all just various names for the same
type. of account. Now one business is not mosting likely to maintain switching what they call it. They'' re. going to choose among those and also stay with it. Between various business you'' re going. to see little variations regarding that last account. Alright, inquiries? Well allow'' s discuss out following subject, if there are no doubt on the homework.What.

I intend to speak about now are money returns. I put on'' t think this is as well difficult of a section,.
yet I reached inform you somehow pupils constantly battle with this inquiry on the.
examination. I assume I understand why and also I will tell you below in a little bit. Cash money rewards are payments.
that a corporation can pay to its supply owners or financiers. They generally always.
impact the stock worth. Now allow'' s speak about my Pepsi co. stock. Every quarter approximately a.
returns check comes; I didn'' t have much shares supply but it would be regarding O you know. $ 25 or two', I didn ' t have much stock. That was just a settlement to me, all the proprietors go. it. The more shares you have the even more dividends in complete you would certainly receive. We'' ve heard this.
Term dividends? Currently there are 3 important dates that I want you to understand about.There.

is the date of declaration that is the day we tape the responsibility for the reward. Then there is the day of record, there is no journal entry needed on the date of document. What the day of document is, that is the date you should possess the supply by to receive that.
Allow'' s speak concerning these. Allow ' s go via an example.On January 9th

, a $1 per share money.
dividend is stated on Dana, Inc.'' s 10,000 common shares outstanding. The returns will.
be paid on March 19 to shareholders of record on February 19. Now, a couple of points genuine.
quick. Since we see this example, let'' s utilize this date of record.
What is this day. Allow ' s come off that actual quick. If you acquire your supply on February 19th you will certainly obtain the returns.
Typically. theoretically speaking the price of the supply goes down a little between the day you get it.
and also the day you get it due to the fact that you'' re getting something you aren'' t.We don'' t actually understand. just how a lot it visits because it'' s really hard to isolate, there ' s many other points happening.
however in theory the supply rate drops a little bit after the day of record. Okay, allow'' s discuss this journal entrance for the date of affirmation.
Take an appearance at. it. We debit retained revenues and we. debt common reward payable. Have we discussed retained earnings? We have place'' t we? Right here ' s what retained revenues resembles. Remember this relapse right here? Let ' s
say that I had. a routine team of individuals that my other half functioned with that we would go out with on weekend breaks.
Let'' s state the first time I went to that party I had actually never ever met any type of
of. My other half states this is my hubby, his name is Dave Krug. I go hi I'' m Dave Krug,.
their hands and they'' ll all be familiar with me and also they chat with me and all that. Then next.
week comes and we go to the exact same event. I most likely to the event and I see those same faces.
as well as they all go who are you, as well as I go put on'' t you remember we met recently? I ' m Dave Krug,. I educate Bookkeeping at the college, remember I have 2 sons. There like O I put on'' t truly. remember you saying that, but it'' s excellent to fulfill you.The next week comes as well as I most likely to. the exact same event, see all
of the very same individuals once again, I claim exactly how you are all doing as well as they. look at me like and who are you? I say don ' t you remember, I ' m Dave Krug I operate at the.
university as well as I have two children. Why do I tell that tale? That'' s since that ' s how

kept. earnings is.I constantly present retained profits; have a look at this slide.
I speak about what. kept earnings are. It ' s a really important account.
I wear'' t believe we'' ve met. That ' s Okay I anticipate that. It'' s. the exact same means with kept incomes.
Retained earnings increases with. earnings, as well as they reduces with web losses.
Do you keep in mind just how with capital in regards. with partnerships and also single proprietorships, exactly how funding would certainly reduce with owner withdraws? It'' s similarly with kept revenues yet we don'' t constantly call it owner withdraws.What.
We call it dividends. Kept profits are lowered by repayments of returns or owner.
circulations. Currently allow'' s go back to that journal access I told you, I assume it ought to make given that. This is the date we declare cash money rewards. We credit this account called common rewards.
payable which is similar to any various other liability as well as we debit preserved profits. Maintained profits.
have a credit history equilibrium, thus when we are debiting retained incomes we are in reality lowering.
it. Does that not make given that currently that we have reacquainted out selves with kept earnings? Since this is like a distributions, it'' s like a withdraw. Cash money is leaving the company.
and also going to the proprietor'' s which is great but that lowers preserved revenues. I think.
the reason on examination people constantly mess this journal entrance up is they don'' t bear in mind, I.
put on'' t think Krug ever spoke about kept revenues. Think though that comprehend what.
returned incomes is very first and afterwards I think this will certainly make since.Student “so like

huge. companies like Sprint, that ' s mosting likely to be in the millions or billions of bucks”? Yes that ' s mosting likely to be a large number. Of course their beginning balance retainer will be even. larger, however of course it will certainly be some lots. Okay to ensure that ' s the day of declaration journal. entrance, when we tape the obligation for the reward. Allow ' s have a look at that one even more.
Since now are going to go onto the date of document, time. No journal entrance is needed.
That'' s simply the day you have to own the supply by. Date of payment rather easy.It ' s on March 19th in.
this instance and also it'' s just the repayment of that liability and it looks just like any.
Cash is attributed since it'' s reduced. That is constantly on the examination but once again for some reason students truly have a tough time with.
that. Allow'' s proceed as well as do this.I spoke enough time, allow'' s proceed and do quick research.
13.7. It won'' t take long however let ' s go in advance and also do fast study 13.7 while they play that.
songs. I'' ll lay the concern on the expenses. Okay I'' m not going to go over that because.
you just reviewed it however not too difficult is it. Let'' s go on and also take a look at the.
answers actual quick.July 15th is

the date of declaration, we debit kept revenues.
for $165,000 and credit typical reward payable for $165,000. Day of document is August 15th.
there'' s no journal entrance required. August 31st is the day of settlement. We credit money as well as.
debit common returns payable for $165,000. It'' s just that easy, isn ' t it? Are there any.
questions on that? Trainee, “” are we supposed to document that there is no formal journal.
access called for””? That'' s a fantastic question; do you require to compose that down? I would certainly claim
. you don'' t need to as lengthy as you place dates there so I identify that the date of declaration.
is July 15th as well as the day of settlement is August 31st.

If you didn'' t put days then there would. be difficulty. You'wear ' t have to write no access if you put the days. You must constantly put.
What'' s the normal balance of retained incomes? It ' s a debt balance. Currently what minimizes retained earnings?
for the company. Well have a look at this slide here. This is a scenario where the.
preserved incomes have an unusual debit equilibrium. It in fact has an unfavorable balance. That implies.
the accumulative internet losses have actually caused that to go unfavorable. It created the maintained incomes.
to be a debit balance. Currently typically when a firm has or commonly time when they have actually a.
maintained profits deficit is what we call that when it'' s an unfavorable equilibrium.
They ' re. not allowed their charter to pay returns. Another thing regarding dividends, you can come.
off that actual quick, are rewards required to be paid? Do we have to pay returns? No.
we don'' t.You do not need to pay rewards. There are some companies that put on'' t. There. are a whole lot of all new firms that claim hi there we are not mosting likely to pay you pay rewards.
because that'' s cash leaving business. What we'' re mosting likely to do, we wish to keep that. cash reinvest it in brand-new items and also modern technologies as well as ideally that will certainly create your stock rate.
to rise much more and you will benefit this way. There are a whole lot of brand-new technology firms.
that do not pay cash money dividends. You are not called for to pay money returns. Let.
me state this. Once you begin paying them, quarterly is typically the means they pay them, when you.
start paying cash money returns quarterly firms are incredibly unwilling to not pay them each.
quarter. Why would that be? Trainee “” you start paying it you get even more long term investors.
that are bought getting that earnings””.

Yes, however narrow it down. Pupil “” You obtain.
individuals that count on the wage””. That is true you get people that depend on that, a great deal of.
Allow me ask you this. If a company is paying dividends.
every quarter for 18 years as well as all of the unexpected they claim we'' re not going to pay rewards
. this quarter, what do you think is going to happen to the supply price? It'' s going to drop. It'' s not a good indicator to the

market.So as soon as a business starts paying dividends even.
they'' re not required they generally maintain it up due to the fact that they put on'' t desire the radical effect.
on the supply cost. In this situation recalling at the slide, a great deal of time the corporate.
If your retained incomes go adverse; if, charter will certainly not permit you to pay rewards.
it has an irregular debit equilibrium. Student “” you wouldn'' t want to anyways because it would.
trigger you to be even much more in financial debt””. Yes then it would certainly trigger the deficit to be also higher,.
Allow ' s speak concerning favored supply.Participating preferred stock is a separate course of supply, generally having priority
over usual investors in concerns to 2 points; split distribution as well as distribution
of properties in case of liquidations. Now this is the main one. So allow'' s talk concerning that. Allow ' s come off that actual quick. Henry allowed'' s claim you ' re a typical'shareholder. Ling Fay let ' s claim you ' re a favored shareholder. Well I wear ' t have to pay rewards but if I do I need to pay Ling Fay the preferred shareholder prior to I pay you the usual shareholder. That is the major choice when it says preferred supply that you get Ling Fay as a preferred

shareholder.You get paid returns before you do. If I wear'' t have enough money to pay you both then only you make money. The various other benefit you get this is one you hope you wear'' t have to conjure up. As the slide says returning to it, circulation of assets in instance of liquidation, if my firm fails and also after I pay my lender, as well as , if you desire to stand in line as well as attempt to get some of your money you will certainly be ahead in the line in contrast to Henry because you'' re the preferred shareholder as well as he ' s the typical investor. That ' s a circumstance that neither of you wishes will occur. The primary preference is in concerns to returns. Now take an appearance at this slide. We'' re mosting likely to find out that participating preferred stock typically has what we call a mentioned returns rate. It virtually acts like a rate of interest price. Here is the huge one.Preferred supply generally does well for this class you can nearly say always has no
ballot legal rights. Participating preferred stock holders have no ballot civil liberties. Coming off of that; allow ' s believe regarding the ramifications'of this. Henry is my usual shareholder as well as Ling Fay is my recommended shareholder. I ' m the administration of the company.'I really hope you ' re both satisfied with me.
'it I might only have one of you be happy with me that do I intend to enjoy with me? Right Henry remedy? Why is that, due to the fact that he votes. He can elect me out. Most likely to national politics, do politicians care much more regarding the teams that elect or the teams that don'' t vote? The groups that elect! This individual can'vote,

she can ' t vote.So. I wish you ' re both satisfied with be yet I'really want you to be satisfied. So I ' m in a circumstance. Since, where I have to pay you dividends first before I can pay him yet I desire him to be pleased. he can vote me out of a task. Does that make feeling? Allow'' s discuss this a little. This is mosting likely to be among those topics that are going to make a whole lot more sense when.
we begin doing examples. Preferred supply is ether noncumulative or advancing. What does this indicate? Well allow'' s discuss noncumulative. Noncumulative means that if.
I didn'' t pay dividends in the past I do not need to pay those previous year returns to
the. favored investors prior to I pay the present investor to them as well as at some point to the.
Allow'' s purge that out with an instance. Let'' s state its 2016 and I did not pay any type of returns in 2014; I did not pay any type of dividends in 2015.
and also now it'' s 2016 and also I intend to pay some dividends.Well if your participating preferred stock Lin Fay noncumulative,. the years that I did not pay rewards; 2014 and also 2015 so sad also bad. I do need to pay. you 2016 your existing year dividends before I
can pay you any dividends. Those other years. where I shorted you and didn ' t pay sorry it ' s noncumulative. Allow'' s say the firm started. in 2014 for ease of that instance.
Let ' s check out the next one.Now most chosen. supply is what we call

What that means is we have actually something called rewards. in defaults as well as that suggests those years where
I did not pay I have to pay those before anything. goes to the usual shareholders.
Let ' s go back to this. I did not pay any type of returns in 2014. It is now 2016 and
let ' s say claim preferred stock supply cumulativeAdvancing
After that I need to pay you your 2016 existing year quantity. Now I am lastly.
cleared to offer some dividends to my typical investor Henry. Do you see the difference,.
advancing knowledgeables noncumulative? Currently we'' re mosting likely to take a look at an example.In this.
example we'' re mosting likely to do two examples real fast. Let'' s do the one initially on the screen. Allow ' s reviewed that. Any type of inquiries? I recognize this may be a little fuzzy right currently,.
hang with me. Take into consideration the complying with stockholders' ' equity area of the balance lamb. We have.
typical supply $5 the same level worth, 40,000 shares accredited provided as well as outstanding. We have actually liked.
stock, now this is that stated rate we were speaking about. What is that 9%? That is the.
mentioned rate. We have a $100 par value and also 1,000 shares accredited as well as superior. The.
board of directors did not declare or pay returns in 2014 yet in 2015, the board of.
supervisors states as well as pays cash money rewards of $42,000. Currently the very, very, really.
point you have to do is this step right here. You have to determine utilizing the specified price.
what one full year of recommended rewards would certainly be. That is computed by taking the.
variety of favored shares impressive times the par value of recommended supply times the.
In this instance just how lots of favored shares do we have exceptional? What'' s. the par value of that supply? What is the mentioned worth?
One complete year of rewards is $9,000. You have actually got to recognize this amount. Now.
let'' s resolve this. Suppose the supply is noncumulative? Well it states in 2014 we
. did not pay any kind of returns. Now it'' s 2015; take an appearance at the screen individuals. Currently we do.
not have to go back, this is noncumulative in this case. We do not have to go back and.
pay 2014. That'' s just gone. We do need to pay the $9,000 amount for the present year. We put on'' t have to pay those past years since it'' s noncumulative.
when we do that. after that we are clear to give typical shareholders some cash.In this case what is 42,000; bear in mind.
we had 42,000 wear'' t forget that number either, it was back there. Nope view on the slide.
Below. The board of supervisors in 2015, the board of supervisors have 42,000 to pay.
out in cash money rewards. TRAINEE “” To ensure that'' s where we get the rest of 33,000″”. Yes.
that'' s where you obtain the remainder of 33,000. $42,000 minus $9,000 amounts to $33,000. Think.
of it in this manner. You have a heap of money, $42,000 well worth. You simply paid your preferred.
$ 9,000, currently just how much do you have left to provide to your typical? $33,000. That'' s if the chosen. stock is noncumulative. Suppose the participating preferred stock is collective? Bear in mind most favored supply is cumulative.Well we did not pay

returns in 2014. currently 2015 comes well the initial thing we have to do is we need to pay the returns. in arrears.
Currently we can'' t go back in time to 2014 we ' re in
2015. We have to pay the amount. We have to pay$ 9,000 for the 2014 dividends.
of the present year'' s rewards which are additionally$ 9,000. That ' s for the current year. We are cost-free and ultimately clear to give the common shareholders some when we do that.
money. Just how much money are we going to provide? We'' re mosting likely to provide $24,000. Questions? STUDENT “” The majority of the moment you'' re going to need to go back and pay someone is where your.
service is beginning primarily, it'' s not mosting likely to take place a whole bunch””? Perhaps that'' s probably.
real however you understand you might go on and also have a few years that are lean as well as you put on'' t pay.

them.The chosen shareholders will understand though, I recognize this they can'' t pay common. investors prior to they catch up due to the fact that the majority of liked supply is collective. What I.
desire you to do now is have a look at this handout I offered you called two instances of.
preferred returns. I want you to take a while while the songs pays and also just service.
the leading fifty percent. Let'' s go on as well as roll that songs and also service this top half.Okay people

in the house if you desire to maintain dealing with it you can. I wear'' t allow a whole lot of time because. a great deal of time individuals attempt to do this and they have no suggestion what they'' re doing. So I such as.
to allow you fight with is a bit and also at least read the trouble and also provide it some.
Let'' s simply do a whole example. Let ' s look at this.
in 2012 of January and has 8,000 shares of $30 the same level worth, 4% non-participating chosen.
supply exceptional as well as 9,000 shares of $10 par worth common stock impressive. It is.
Here that'' s how much. Determine the complete rewards distributed to each course of investor.
under each of the assumptions offered. Okay the first thing you need to do people is what? You need to determine the overall recommended returns for one year. How do we do that? We take the variety of recommended shares exceptional times the par worth of participating preferred stock times.
8,000 shares. What'' s the par worth? What'' s the stated.
rate? 4%. What does the equivalent? $9,600 is one complete year of favored rewards. We have.
to have that number. Let'' s do this understand. Let ' s claim first of all the favored supply is not.
advancing. Okay 2012 come exactly how much do we have? Allow'' s just function it such as this. 2012 we.
have $9,000 to give out. We desire we might provide $9,600 but we can just provide.
$ 9,000. We will offer them what we have. Just how much do the common obtain? They simply jack squat. Okay this is not cumulative so sorry. 2013 come we have $10,000 to hand out. Just how much.
$9,000 then we'' re excellent, we ' re cleared to give the. These are buck quantities. 2014.
comes we have little bit far better years we have a little even more money. We have $20,000 to give.
out.How a lot

do we give the preferred shareholders? $9,600. Just how much do we have remaining to provide.
to the usual? $10,400. This is not cumulative. Okay absolutely different case. Suppose the chosen.
supply is collective? A lot of favored supply is collective. Let'' s go back. Disregard this.
in the meantime. We have $9,000 we want we could provide them $9,600. Well we provide what we have.
Exactly how much do the typical get. Right currently we have returns in arears of.
Following year comes we have $10,000 to provide out. The initial thing were.
going to do is pay the dividends in arears of $600. Currently we'' re captured
up for previous. years, yet we have to pay the existing year. Just how much cash do we have left now? $10,000 minus $600 equates to$ 9,400. We wish we can give them $9,600 for the existing.
Exactly how much money does the typical obtain? Absolutely no.
are our dividends in arears at this moment? $200. Currently in complete they got $10,000 this year,.
the recommended shareholders right? $600 of that were returns in arears for the previous.
year and $9,400 was a deposit for the current year. Following year comes and also we have.
$ 20,000. Very first thing we have to do is pay the returns in arears or $200. Currently we are.
all captured up for previous years. What we need to pay the current year quantity. Just how much do.
We can pay the entire quantity now can'' t we? Currently we are lastly totally free.
and clear to give the typical investors some cash. How much cash is entrusted to provide.
What are the dividends in arears at this point? It'' s much easier.
when we kind of go with an example isn'' t it? Allow me offer you your research and also we will.
call it a day. What I want you to do for residence work is I desire you to do the lower fifty percent of.
this sheet. So do the bottom half of this sheet I provided you. I also want you to do.
fast study 13.6 and workout 13.8 as well as 13.9. Okay complete this, after that do this fast study and also these exercises and also we are great to go. Sorry are we still on? Do this sheet right below cash split example. Okay so allow.
me reword. I desire you to do this, that quick study those two workouts and likewise the money.
reward example handout. It'' s actually not going to take too long. Okay see you later on;.

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