Required InformationKnowledge Check 01Which of the following statements about disclosures relating to EPS are true? (Select all that apply.)Check All That ApplyA reconciliation is required of the numerator and denominator used in the basic EPS computations to the numerator and the denominatorused in the diluted EPS computations.Any adjustments to the numerator for preferred dividends must be disclosed.Any potential common shares that weren't included because they were dilutive must be disclosed.Any transactions that occurred before the end of the most recent period that would materially affect earnings per share.Prev.18 of 18NextIMG-1894.jpgIMG-1895.jpgIMG-1896.ipg

Earnings per share (EPS) is calculated by dividing a company's net profit by the number of…

Which of the following statements about disclosures relating to EPS are true? (Select all that apply.) Check All That Apply A reconciliation is required of the numerator and denominator used in the basic EPS computations to th used in the diluted EPS computations.

Which of the following statements about disclosures relating to EPS are true? (Select all that apply.) Check All That Apply A reconciliation is required of the numerator and denominator used in the basic EPS computations to th used in the diluted EPS computations.

Auditing: A Risk Based-Approach (MindTap Course List)

11th Edition

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter13: Auditing Debt, Equity, And Long-term Liabilities Requiring Management Estimates

Section: Chapter Questions

Problem 32CYBK

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Access the FASB Accounting Standards Codification at the FASB website ( asc.fasb.org ). Determine the specific citation for accounting for each of the following items: 1. Initial measurement of stock options. 2. The measurement date for share-based payments classified as liabilities. 3. The formula to calculate diluted earnings per share. 4. The way stock dividends or stock splits in the current year affect the presentation of EPS in the income statement.
Which of the following statements about EPS is true? Question 25 options: a) Both publicly and non-publicly accountable enterprises must disclose EPS on their financial statements. b) EPS is an indicator of liquidity of an entity. c) Two types of EPS are reported: basic and complex. d) Diluted EPS looks at earnings on a per-share basis for shares that were outstanding and also for shares that had the potential to be outstanding during the year.
7. Use the information in Exercise 6, but assume instead that a 20% stock dividend was declared. Answer the same requirements. (see attached images especially for the information in Exercise 6 in the uploaded images. Please answer it. thank you so much) a) Prepare the required entries for the declaration and distribution. b) Prepare the shareholders’ equity section immediately after the stock dividend was declared.
7. Use the information in Exercise 6, but assume instead that a 20% stock dividend was declared. Answer the same requirements. (see attached images especially for the information in Exercise 6 in the uploaded images. Please answer it based on your knowledge. thank you so much!) NOTE: only letter C and D is the unanswered so please answer it thank you! a) Prepare the required entries to for the declaration and distribution. b) Prepare the shareholders’ equity section immediately after the stock dividend was declared. c) Compare with the accounts and figures given above and explain the effects of this stock dividend on the a) assets, b) liabilities, and c) shareholders' equity. d) Prepare again the shareholders' equity immediately after the stock dividend was distributed. Compare the accounts against no 1 above and explain the effects of this distribution on the a) assets, b) liabilities, and c) shareholders' equity.
Case 2: Earnings per ShareProgresso Corporation, one of the new audit clients, has not reported EPS data in itsannual reports to stockholders in the past. The president requested that you furnishinformation about the reporting of EPS data in the current year’s annual report inaccordance with GAAP.Required:a) Define the term earnings per share as it applies to corporation with a capitalizationstructure composed of only one class of common stock. Then explain how EPSshould be computed and how the information should be disclosed in thecorporation’s financial statements.b) Discuss the treatment, if any, that should be given to each of the following itemsin computing EPS for financial statement reporting:i. The declaration of current dividends on cumulative preferred stock.ii. The acquisition of some of the corporation’s outstanding common stockduring the current fiscal year (The stock was classified as treasury stock).iii. A two-for-one stock split of common stock during the current fiscal…
3. Which statement is correct?I. Options and warrants are dilutive if the exercise price or option price is lower than the average market price of the ordinary share.II. Earnings per share shall be computed on the basis of average ordinary shares outstanding during the year. 4. Which statement is correct?I. EPS disclosure are required for all public and nonpublic entities.II. PAS 33, requires disclosures on the face of income statement of both basic and diluted earnings per share
Question 1What is the accounting treatment of the direct issue costs of shares of stocks?O Debit to the related share premiuin during organization stage and operating stageDebit to organizational cost during the organization stageDebit to revenue expenditure during the operating stageDebit to accumulated expenses during the operating stageDQuestion 2What is the total number of shares that a corporation may issue under its charter?O Authorized sharesIssued shareso Unissued sharesO Treasury sharesEQuestion 3In case shares are issued for outstanding liabilities, what is the measure of recording share capital and share premium?O Par value of the shares issuedAmount of liabilities set-offFair value of the shares issuedBook value of the shares issued
Note 25, “Share Repurchase,” provides the information we need to reconstruct thejournal entry that summarizes Target’s share repurchases in the year endedJanuary 30, 2016. Provide that entry. Does Target account for share repurchases astreasury stock or retired shares? Explain.
1. What is the accounting for treasury share transactions? a. On repurchase or re-issuance of previously purchased own shares, no gain or loss is recognized. b. Treasury shares are accounted for as financial assets. c. On re-issuance of treasury shares, a gain or loss is recognized equal to the difference between the previous repurchase price and the re-issuance price. d. On repurchase of treasury shares, a gain or loss is recognized equal to the difference between the amount at which the shares were issued and the repurchase price for the shares. . 2. If a no-par value share is issued... a. The value of each share is automatically ₱5. b. The corporation is automatically in violation of its state charter. c. There is no legal capital. d. The entire proceeds is considered as legal capital. . 3 Which of the following statements relating to bonds is incorrect? a. None of the choices b. A bond’s face value is the amount the issuer must pay…
1. What is the accounting for treasury share transactions? a. Treasury shares are accounted for as financial assets. b. On repurchase or re-issuance of previously purchased own shares, no gain or loss is recognized. c. On re-issuance of treasury shares, a gain or loss is recognized equal to the difference between the previous repurchase price and the re-issuance price. d. On repurchase of treasury shares, a gain or loss is recognized equal to the difference between the amount at which the shares were issued and the repurchase price for the shares.
At what payout percentage is a stock dividend typically considered a stock split, in accordance with the recommendation of the Financial Accounting Standards Board? a. 15% b. 33% c. 25% d. 10%
What additional disclosures about preferred and common shares does the FASB require?