ACC 312 Test 1 (2)(3) (1)

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University of Rhode Island *

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312

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Accounting

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Feb 20, 2024

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docx

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Accounting 312 External Reporting Spring, 2023, Test 1 JA Schweikart Name_________________________________ You are to download this test on your computer, work on the homework by typing in answers and return to me Monday evening, February 6, no later than 5:00 pm. Return to me at my RIC email jschweikart@ric.edu. 1. (20 pts) Altoona Company began the year with 300,000 shares of $5 par common stock. On April 1, they issued 150,000 shares. On July 1, they issued 60,000 shares. On September 1, Altoona experienced a 2 for 1 stock split, and on October 1, they repurchased 20,000 shares and placed them in the treasury. Prepare a schedule showing the weighted average shares for the year to be used in earnings per share calculations.
2. (20 pts) Johnstown Company granted 10 officers rights to buy 10,000 shares each of common stock $2 par, at $11 per share on May 1, 2020 the grant date. The stock was selling for $8 per share at the time. The rights cannot be exercised until the beginning of 2021 and expire at the end of 2021. Compensation expense is $175,000, covering a period of 2021 and 2022. Record the following: Dr. Cr. May 1, 2020, the grant date, issue of the rights. Dec. 31, 2021, compensation expense Jul. 1, 2021, 90% of the rights were exercised, as the stock climbed to $13 per share. Dec. 31, 2022, 10% of the rights expired because one officer left the company.
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