ACC 300 CSU Accounting Cycle and Shareholders Value Questions

The Accounting Cycle and Stockholders’ Equity Analysis

Part 3

ASSUME YOU ARE THE CHIEF ACCOUNTANT MAKING A PRESENTATION DURING THE STOCKHOLDERS’ ANNUAL MEETING FOR YOUR CORPORATION. PROVIDE A BRIEF EXPLANATION TO STOCKHOLDERS ON EACH OF THE FOLLOWING QUESTIONS:

Shares

A)   In what ways can shares be “preferred”? In which ways are they similar and different from common shares?  Give real-  world examples.

B)  How does the book value of shares of stock differ from the market value of shares of stock? Use a real-world example in your answer.

Dividends:

C)  Discuss at least three main issues a board of directors considers when making a dividend declaration decision.

D)  How does a share dividend differ from a share split?

Retained Earnings :

e) Explain why companies place restrictions on some of their retained earnings.