incomeandchangesinretainedearnings(编辑修改稿)

incomeandchangesinretainedearnings(编辑修改稿)内容摘要：

es, Inc., 1999 Slide 1224 Irwin/McGrawHill Priceearnings Ratio (P/E) Often, the PriceEarnings Ratio is used to evaluate the reasonableness of a pany抯 stock price. P r i c e E a r ni ng s R a t i o =C ur r e nt S t oc k P r i c e ?E a r ni ng s P e r S ha r eLet’s examine this further. ?The McGrawHill Companies, Inc., 1999 Slide 1225 Irwin/McGrawHill Earnings Per Share (EPS) A measure of the pany抯 profitability and earning power for the period. E a r ni ng s P e r S ha r e =N e t I nc om e ?W e i gh t e d A v e r a ge N um be r of S ha r e s O ut s t a nd i ngBased on the number of shares issued and the length of time that number remained unchanged. ?The McGrawHill Companies, Inc., 1999 Slide 1226 Irwin/McGrawHill Earnings Per Share (EPS) Partial Ine Statement Use the information from Apex Co. that was generated earlier. Assume that Apex has weighted average shares outstanding of 156,250. Prepare a partial ine statement showing the EPS for Ine from Operations and for the other special items. ?The McGrawHill Companies, Inc., 1999 Slide 1227 Irwin/McGrawHill Earnings Per Share (EPS) Partial Ine Statement I n c o m e S t a t e m e n t A m o u n t s E P SI n c o m e f r o m c o n t i n u i n g o p e r a t i o n s 3 5 0 , 0 0 0$ 2 . 2 4$ L o s s f r o m d i s c o n t i n u e d o p e r a t i o n s ( 1 7 5 , 0 0 0 ) ( 1 . 1 2 ) L o s s b e f o r e e x t r a o r d i n a r y i t e m s a n d c u m u l a t i v e e f f e c t o f a c c o u n t i n g c h a n g e 1 7 5 , 0 0 0$ 3 . 3 6$ E x t r a o r d i n a r y l o s s ( 5 2 , 5 0 0 ) ( 0 . 3 4 ) C u m u l a t i v e e f f e c t o f a c c o u n t i n g c h a n g e 4 5 , 5 0 0 0 . 2 9 N e t L o s s 1 6 8 , 0 0 0$ 3 . 3 2$ ** Rounding error. ?The McGrawHill Companies, Inc., 1999 Slide 1228 Irwin/McGrawHill Earnings Per Share (EPS) If preferred stock is present, subtract preferred dividends from ine prior to puting EPS. N et I n co m e P r ef er r ed D iv id en d sW eig h t ed A v er ag e N u m b er o f C o m m o n S h ar es Ou t st an d in gE ar n in g s P er S h ar e =EPS is required to be reported in the ine statement. ?The McGrawHill Companies, Inc., 1999 Slide 1229 Irwin/McGrawHill Accounting for Cash Dividends Declared by board of directors. Not legally required. Creates liability at declaration. Requires sufficient Retained Earnings and Cash. ?The McGrawHill Companies, Inc., 1999 Slide 1230 Irwin/McGrawHill Dividend Dates Date of Declaration  Board of directors declares the dividend.  Record a liability. D a t e D e s c r i p t i o n D e b i t C r e d i tD i v i d e n d s $$$$ D i v i d e n d s Pa y a b l e $$$$?The McGrawHill Companies, Inc., 1999 Slide 1231 Irwin/McGrawHill Dividend Dates ExDividend Date  The day which serves as the ownership cutoff point for the receipt of the most recently declared dividend. D a t e D e s c r i p t i o n D e b i t C r e d i tN O EN T R Y R EQ U I R ED?The McGrawHill Companies, Inc., 1999 Slide 1232 Irwin/McGrawHill Dividend Dates X Date of Record  Stockholders holding shares on this date will receive the dividend. (No entry) ?The McGrawHill Companies, Inc., 1999 Slide 1233 Irwin/McGrawHill Date of Payment  Record the payment of the dividend to stockholders. Dividend Dates D a t e D e s c r i p t i o n D e b i t C r e d i tD i v i d e n d s Pa y a b l e $$$$ C a s h $$$$?The McGrawHill Companies, Inc., 1999 Slide 1234 Irwin/McGrawHill Dividend Dates Question On June 1, 1999 a corporation’s board of directors declared a dividend for the 2,500 shares of its $100 par value, 8% preferred stock. The dividend will be paid on July 15. Which of the following will be included in the July 15 entry? a. Debit Retained Earnings $20,000. b. Debit Dividends Payable $20,000. c. Credit Dividends Payable $20,000. d. Credit Preferred Stock $20,000. ?The McGrawHill Companies, Inc., 1999 Slide 1235 Irwin/McGrawHill On June 1, 1999 a corporation抯 board of directors declared a dividend for the 2,500 shares of its $100 par value, 8% preferred stock. The dividend will be paid on July 15. Which of the following will be included in the July 15 entry? a. Debit Retained Earnings $20,000. b. Debit Dividends Payable $20,000. c. Credit Dividends Payable $20,000. d. Credit Preferred Stock $20,000. Dividend Dates Question $100 ?8% = $8 dividend per share $8 ?2,500 = $20,000 total dividend D a t e D e s c r i p t i o n D e b i t C r e d i t1 5 J u l D i v i d e n d s Pa y a b l e 2 0 , 0 0 0 C a s h 2 0 , 0 0 0 ?The McGrawHill Companies, Inc., 1999 Slide 1236 Irwin/McGrawHill Accounting for Stock Dividends No change in total stockholders?equity. All stockholders retain same percentage ownership. No change in par values. Distribution of additional shares of stock to stockholders. ?The McGrawHill Companies, Inc., 1999 Slide 1237 Irwin/McGrawHill Summary of Effects of Stock Dividends and Stock Splits S m a l l S to c k D i v i d e n dL a r g e S to c k D i v i d e n dS to c k S p l i tsT o ta l S to c k h o l d e r s 39。 E q u i tyN o E ffe c t N o E ffe c t N o E ffe c tC o m m o n S to c k I n c r e a s e s I n c r e a s e s N o E ffe c tP a i d i n C a p i ta l I n c r e a s e s N o E ffe c t N o E ffe c tR e ta i n e d E a r n i n g s D e c r e a s e s D e c r e a s e s N o E ffe c tN u m b e r o f S h a r e s O u ts ta n d i n gI n c r e a s e s I n c r e a s e s I n c r e a s e sP a r V a l u e。