declaration date

Examples of declaration date in the following topics:

• Dividends Payable

  • Therefore, a shareholder receives a dividend in proportion to the shares he owns -- for example, if shareholder Y owns 100 shares when company Z declares a dividend of USD 1.00 per share. then shareholder Y will receive a dividend of USD 100 for his shares.
  • On the dividend declaration date, a company's board of directors announces its intention to pay a dividend to shareholders on record as of a certain date (date of record).
  • On the declaration date, the Board announces the date of record and a payment date; the payment date is the date when the funds are sent to the shareholders and the dividends payable account is reduced for the payment amount.
  • Companies that declare dividends must record a liability for the amount of the dividends that will be paid to investors.

• Assessing Fair Value

  • If a company purchases stocks or bonds with the intent to sell these items at a future date when they need cash, these are referred to as "Available-for-sale securities".
  • This is fair value on the purchase date.

• Types of Bonds

  • A term bond matures on the same date as all other bonds in a given bond issue.
  • Serial bonds in a given bond issue have maturities spread over several dates.
  • A call premium is the price paid in excess of face value that the issuer of bonds must pay to redeem (call) bonds before their maturity date.
  • Some issuers declared bankruptcy or sought relief from the bondholders by negotiating new debt terms.
  • The bondholder receives the full principal amount on the redemption date.

• Bonds Payable and Interest Expense

  • The borrower promises to pay (1) the face value or principal amount of the bond on a specific maturity date in the future, and (2) periodic interest at a specified rate on face value at stated dates, usually semiannually, until the maturity date .
  • Example of bonds issued at face value on an interest date:-
  • On 2010 December 31, the date of issuance, the entry is:
  • On 2020 December 31, the maturity date, the entry would be:
  • For example, assume the Valley bonds were dated 2010 October 31, issued on that same date, and pay interest each April 30 and October 31.

• Current Maturities of Long-Term Debt

  • Long-term liabilities are liabilities with a due date that extends over one year, such as a notes payable that matures in 2 years.
  • The position of where the debt should be disclosed is based on its maturity date in relation to the due date of other current liabilities.
  • For example, a loan for which two payments of USD 1,000 are due--one in the next 12 months and the other after that date--would be split into one USD 1000 portion of the debt classified as a current liability, and the other USD 1000 as a long-term liability (note this example does not take into account any interest or discounting effects, which may be required depending on the accounting rules that may apply).
  • Bonds are a form of long-term debt because they typically mature several years after their original issue date.

• Redeeming Before Maturity

  • Some bonds give the issuer the right to repay the bond before the maturity date on the call dates.
  • Some bonds give the holder the right to force the issuer to repay the bond before the maturity date on the put dates.

• Characteristics of Bonds

  • The issuer has to repay the nominal amount on the maturity date.
  • As long as all due payments have been made, the issuer has no further obligations to the bond holders after the maturity date.
  • The length of time until the maturity date is often referred to as the term or maturity of a bond.
  • Callability — Some bonds give the issuer the right to repay the bond before the maturity date on the call dates.
  • Putability — Some bonds give the holder the right to force the issuer to repay the bond before the maturity date on the put dates.

• Recognition of Revenue at Point of Sale or Delivery

  • Companies can recognize revenue at point of sale if it is also the date of delivery or if the buyer takes immediate ownership of the goods.
  • Goods sold, especially retail goods, typically earn and recognize revenue at point of sale, which can also be the date of delivery if the buyer takes immediate ownership of the merchandise purchased.

• Selecting an Inventory Method

  • Purchase date: 10/1/12 -- 10 units at a cost of USD 5
  • Purchase date: 10/5/12 -- 5 units at a cost of USD 6
  • Purchase date: 10/1/12 -- 10 units at a cost of USD 5
  • Purchase date: 10/5/12 -- 5 units at a cost of USD 6
  • Inventory is not as understated as under LIFO, but it is not as up-to-date as under FIFO.

• What Goes on the Balances Sheet and What Goes in the Notes

  • Assets, liabilities, and the equity of stockholders are listed as of a specific date, such as the end of a fiscal year or accounting period.
  • Current liabilities and their account balances as of the date on the balance sheet are presented first, in order by due date.