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AccountingIntermediate Accounting: Reporting And Analysis3rd Edition

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Chapter 15, Problem 10C
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Intermediate Accounting: Reporting...

3rd Edition
James M. Wahlen + 2 others
ISBN: 9781337788281

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Chapter
Section
Problem 1GI
Problem 2GI
Problem 3GI
Problem 4GI
Problem 5GI
Problem 6GI
Problem 7GI
Problem 8GI
Problem 9GI
Problem 10GI
Problem 11GI
Problem 12GI
Problem 13GI
Problem 14GI
Problem 15GI
Problem 16GI
Problem 17GI
Problem 18GI
Problem 19GI
Problem 20GI
Problem 21GI
Problem 22GI
Problem 23GI
Problem 24GI
Problem 25GI
Problem 26GI
Problem 1MC
Problem 2MC
Problem 3MC
Problem 4MC
Problem 5MC
Problem 6MC
Problem 7MC
Problem 8MC
Problem 9MC
Problem 10MC
Problem 1RE
Problem 2RE
Problem 3RE
Problem 4RE
Problem 5RE
Problem 6RE
Problem 7RE
Problem 8RE
Problem 9RE
Problem 10RE
Problem 11RE
Problem 12RE
Problem 13RE
Problem 1E
Problem 2E
Problem 3E
Problem 4E
Problem 5E
Problem 6E
Problem 7E
Problem 8E
Problem 9E
Problem 10E
Problem 11E
Problem 12E
Problem 13E
Problem 14E
Problem 15E
Problem 16E
Problem 17E
Problem 18E
Problem 19E
Problem 1P
Problem 2P
Problem 3P
Problem 4P
Problem 5P
Problem 6P
Problem 7P
Problem 8P
Problem 9P
Problem 10P
Problem 11P
Problem 12P
Problem 13P
Problem 14P
Problem 15P
Problem 16P
Problem 17P
Problem 1C
Problem 2C
Problem 3C
Problem 4C
Problem 5C
Problem 6C
Problem 7C
Problem 8C
Problem 9C
Problem 10C
Problem 11C
Problem 12C
Problem 13C
Problem 14C
BuyFindarrow_forward

Intermediate Accounting: Reporting...

3rd Edition
James M. Wahlen + 2 others
ISBN: 9781337788281
Textbook Problem
6 views

Treasury Stock

For numerous reasons, a corporation may reacquire shares of its own capital stock. When a corporation purchases treasury stock, it has two options as to how to account for the shares: (1) the cost method and (2) the par value method.

Required:

Write a short report that compares and contrasts the cost method with the par value method for each of the following:

  1. 1. Purchase of shares at a price less than par value.
  2. 2. Purchase of shares at a price greater than par value.
  3. 3. Subsequent resale of treasury shares at a price less than purchase price, but more than par value.
  4. 4. Subsequent resale of treasury shares at a price greater than both purchase price and par value.
  5. 5. Effect on net income.

1.

To determine

Write a short report on “purchase of shares at a price less than par value” that compares and contrasts the cost method with par value method.

Explanation

Cost method: Under this method, at the time of reacquiring the treasury stock, it will be debited for the amount paid. At the time of reissuance, treasury stock will be credited and cash will be debited with the proceeds received. Credit the additional paid-in capital for the difference amount.

Par value method: Under this method, at the time of reacquiring the treasury stock, it will be debited with par valu...

2.

To determine

Write a short report on “purchase of shares at a price greater than par value” that compares and contrasts the cost method with par value method.

3.

To determine

Write a short report on “subsequent resale of treasury shares at a price less than purchase price, but more than par value” that compares and contrasts the cost method with par value method.

4.

To determine

Write a short report on “subsequent resale of treasury shares at a price greater than both purchase price and par value” that compares and contrasts the cost method with par value method.

5.

To determine

Write a short report on “effect on net income” that compares and contrasts the cost method with par value method.

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Ch-15 P-1GICh-15 P-2GICh-15 P-3GICh-15 P-4GICh-15 P-5GICh-15 P-6GICh-15 P-7GICh-15 P-8GICh-15 P-9GICh-15 P-10GI
Ch-15 P-11GICh-15 P-12GICh-15 P-13GICh-15 P-14GICh-15 P-15GICh-15 P-16GICh-15 P-17GICh-15 P-18GICh-15 P-19GICh-15 P-20GICh-15 P-21GICh-15 P-22GICh-15 P-23GICh-15 P-24GICh-15 P-25GICh-15 P-26GICh-15 P-1MCCh-15 P-2MCCh-15 P-3MCCh-15 P-4MCCh-15 P-5MCCh-15 P-6MCCh-15 P-7MCCh-15 P-8MCCh-15 P-9MCCh-15 P-10MCCh-15 P-1RECh-15 P-2RECh-15 P-3RECh-15 P-4RECh-15 P-5RECh-15 P-6RECh-15 P-7RECh-15 P-8RECh-15 P-9RECh-15 P-10RECh-15 P-11RECh-15 P-12RECh-15 P-13RECh-15 P-1ECh-15 P-2ECh-15 P-3ECh-15 P-4ECh-15 P-5ECh-15 P-6ECh-15 P-7ECh-15 P-8ECh-15 P-9ECh-15 P-10ECh-15 P-11ECh-15 P-12ECh-15 P-13ECh-15 P-14ECh-15 P-15ECh-15 P-16ECh-15 P-17ECh-15 P-18ECh-15 P-19ECh-15 P-1PCh-15 P-2PCh-15 P-3PCh-15 P-4PCh-15 P-5PCh-15 P-6PCh-15 P-7PCh-15 P-8PCh-15 P-9PCh-15 P-10PCh-15 P-11PCh-15 P-12PCh-15 P-13PCh-15 P-14PCh-15 P-15PCh-15 P-16PCh-15 P-17PCh-15 P-1CCh-15 P-2CCh-15 P-3CCh-15 P-4CCh-15 P-5CCh-15 P-6CCh-15 P-7CCh-15 P-8CCh-15 P-9CCh-15 P-10CCh-15 P-11CCh-15 P-12CCh-15 P-13CCh-15 P-14C

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