Exam 15: Accounting for Stockholders Equity

Syd's Co. reported comprehensive income of $8,700 for the current year. It had unrealized losses on available-for-sale debt securities of $1,700 after tax, and a foreign currency translation gain of $1,900 after tax. What is net income for the current year?

When a company purchases and sells treasury shares for amounts above and below cost, it reports these "gains" and "losses" ________.

A change in stated value per share does not require shareholder approval and filings with the state.

Caesar Cruise Lines, Inc. issues 7,000 shares of common stock with a $2 par value. The issue price of the stock is $28 per share, and the company paid an underwriter $500 in stock issue costs. What is the journal entry required to record the issuance of the shares?

When a company has unusually high or low net income, the ________ is not the most useful valuation ratio.

Other comprehensive income includes income items that bypass the income statement.

TLR Productions hires a consultant for a new project, and issues common stock with a par value of $900 in exchange for consulting services received. The common stock has a fair value of $3,300. What is the journal entry required to record this transaction?

Bach Company has issued both common and preferred stock. The preferred stock is convertible into common stock. The following information is provided for Bach Company's Stockholders' equity: Convertible Preferred Stock, \ 14 par, 25,000 shares Issues and outstanding \ 350,000 Additional Paid-in Capital in Excess of Par-Preferred 100,000 Common Stock, \ 9 par, 125,000 shares issued and putstanding 1,125,000 Additional Paid-in Capital in Excess of Par-Common 875,000 Retained Earnings 1,600,000 What is the necessary journal entry if 5,000 shares of preferred are converted under each independent scenario: a. Preferred shares are convertible into common stock on a share-for-share basis. b. Each share of convertible preferred stock is convertible into 1.5 shares of common stock.

Purrfect Paws Company issues 1,000 shares of $50 par preferred stock for $250,000. The company is not required to buy back the preferred stock. However, the preferred stock includes a redemption feature that gives the holder the option to redeem the shares for cash at specified dates. This would be classified as ________ under U.S. GAAP and ________ under IFRS.

Treasury shares reduce the number of shares ________.

Stock issue costs are treated as a(n) ________.

On August 1, 2018, Omega Co. declared and issued a 15 percent common stock dividend. Prior to this, Omega Co. had 50,000 outstanding shares of $2 par value common stock. The market value of Omega Co.'s stock was $18 per share at the time the dividend was issued. As a result of this stock dividend, Omega Co.'s total stockholders' equity ________.

Danio Fisheries issued 420,000 shares of $4 par value stock. On August 1, Danio Fisheries implements a two-for-one stock split. After the stock split, the total number of shares outstanding is ________ and the total par value is ________.

The two methods of accounting for treasury stock are the cost method and the fair value method.

S & C Company issues 1,800 shares of common stock with a $2 par value. The issue price of the stock is $15 per share. What is the journal entry required to record the issuance of the shares?

Pollyanna & Partners reacquired 40,000 shares of its $1 par common stock for $25 per share. What is the journal entry needed to record this transaction?

Price Co. reported net income of $18,000 for the current year. It had unrealized losses on available-for-sale debt securities of $1,700 after tax, and a foreign currency translation loss of $700 after tax. What is comprehensive income for the current year?

On January 1, 2016, Warhol Company issued 3,000 shares of 10%, $200 par value, cumulative preferred stock for $700,000. No preferred dividends were declared in 2016 and 2017. On December 30, 2018, the Board declared $3,000 in dividends. How much of the dividend is allocated to preferred and common shareholders?

________ preferred stock shares allow the shareholder to convert his shares to common shares at a predetermined rate or exchange ratio.

The most popular method of accounting for treasury stock is the ________ method.