FAR 7 Flashcards
How to calculate total book value per share of Common stock?
Total stockholder’s (Common stock + Preferred stock + APIC + RE) equity minus preferred stock interest (preferred stock par value + Premium + Pref stock div in arrears) divided by number of Common stock.
How is dividend distributed between preferred and common stock?
Step1: calculate total capitalization on Pref stock and Common stock by multiplying par value.
Step 2: Multiply percent of preferred stock by preferred stock capitalization and common stock capitalization.
Step 3: the remaining dividend is shared based on relative capitalization percentage for example (100000 preferred share dividend divided by 300000 totat stock capitalization multiplied by 3000 remaining dividends declared)
When dividend includes a liquidating dividend?
The liquidating dividend is not equal to the company’s additional paid-in capital. A dividend is a liquidating dividend to the extent that the dividend exceeds retained earnings.
How to calculate EPS when preferred share dividend paid?
Do not consider amount paid because it’s cumulative, calculate the percentage on Preferred share and then subtract that from income and divide by common stock outstanding.
How to treat interest expense, interest income, dividend received, insurance proceeds, settled lawsuit, other non operating expense on Cashflow?
Operating Activities.
Indirect Cashflow opertating activities
+most depr/amort
+ losses/ Provisions (bad debt)
- Gains and Amort bond premium
- Equity earnings > $rec’d
-+ change in Operating asset
+- change in operating liab
What needs to be shown as supplementary info on cash flow?
Interest paid and taxes paid.
What is NOT included in footnote disclosure of financial statements of pension benefit plan?
The difference in executive and non executive plans
What financial statements are required on defined Benefit pension plan?
> Statement of net assets available for benefits
Statement of changes in net assets available for benefits
statement of accumulated plant benefits
Statement of changes in accumulated plant benefits
Cash flow is not required but may be presented.
What financial statements are required on defined Benefit Contribution plan?
> Statement of net asset available for benefits
Statement of changes in net assets available for benefits
Cashflow is not required but may be created
