Explanation The shares are issued for cash. The amount of cash received increases the asset and is debited to the cash account. Cash is debited with ($16×20,000) = $320,000. The common stock account is credited with an amount equal to the par value multiplied by the number of shares issued ($10×20,000) = $200,000. Any excess over the par value paid in by the stockholders in return of the shares issued to them is credited to the paid-in capital in excess of par account. So, the balance amount ($320,000−$200,000) = $120,000 is credited to the paid-in capital in excess of par account. Preference shares have been issued for assets other than cash. Assets are debited at fair value and appraised value. The credit to preference shares account is preferred stock (4,000×$100) = $400,000 and balance ($50,000+$160,000+$270,000−400,000) is credited to the paid-in capital account. 1,800 shares were reacquired for $17 each. Reacquisition was for cash. So, cash is credited for (1,800×$17) = $30,600. An equal amount is debited to treasury stock account to complete the entry...

16th Edition

ISBN: 9781119349761

Author: Kieso

Publisher: WILEY C

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Question

Chapter 15, Problem 1P

To determine

Equity transactions and statement: Common stock represents equity ownership in a corporation. Common stock holders bear a higher amount of risk of loss and are also entitled to higher benefits in the company’s profits and assets. Common stock can be issued at par or at premium or discount. Common shares can be issued not only for cash but also in exchange of another asset, for example, land .Sometimes companies buy back or require their own shares. These stocks are either retired or held for reissue. Shares held for reissue are called treasury stock. Treasury stocks are not held as assets but are same as unissued capital. Treasury stocks can be reissued at different rates at different points of time. The sale can be at cost or above or below cost.

To prepare: To prepare journal entries and equity section of balance sheet.

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05:47

Chapter 15, Problem 24E

Chapter 15, Problem 2P

Chapter 15 Solutions

ACP INTERMEDIATE ACCOUNTING VOL. 1 >C

Ch. 15 - Prob. 1Q Ch. 15 - Prob. 2Q Ch. 15 - 3. Distinguish between common and preferred...Ch. 15 - 4. Why is the distinction between paid-in capital...Ch. 15 - Prob. 5Q Ch. 15 - Prob. 6Q Ch. 15 - Prob. 7Q Ch. 15 - Prob. 8Q Ch. 15 - Prob. 9Q Ch. 15 - Prob. 10Q

Ch. 15 - Prob. 11Q Ch. 15 - Prob. 12Q Ch. 15 - Prob. 13Q Ch. 15 - Prob. 14Q Ch. 15 - Prob. 15Q Ch. 15 - Prob. 16Q Ch. 15 - Prob. 17Q Ch. 15 - 18. Indicate how each of the following accounts...Ch. 15 - Prob. 19Q Ch. 15 - Prob. 20Q Ch. 15 - Prob. 21Q Ch. 15 - Prob. 22Q Ch. 15 - Prob. 23Q Ch. 15 - Prob. 24Q Ch. 15 - Prob. 25Q Ch. 15 - Prob. 26Q Ch. 15 - Prob. 27Q Ch. 15 - Prob. 28Q Ch. 15 - Prob. 29Q Ch. 15 - Prob. 1BE Ch. 15 - Prob. 2BE Ch. 15 - Prob. 3BE Ch. 15 - Prob. 4BE Ch. 15 - Prob. 5BE Ch. 15 - Prob. 6BE Ch. 15 - Prob. 7BE Ch. 15 - Prob. 8BE Ch. 15 - Prob. 9BE Ch. 15 - Prob. 10BE Ch. 15 - Prob. 11BE Ch. 15 - Prob. 12BE Ch. 15 - Prob. 13BE Ch. 15 - Prob. 14BE Ch. 15 - Prob. 15BE Ch. 15 - Prob. 1E Ch. 15 - Prob. 2E Ch. 15 - Prob. 3E Ch. 15 - Prob. 4E Ch. 15 - Prob. 5E Ch. 15 - Prob. 6E Ch. 15 - Prob. 7E Ch. 15 - Prob. 8E Ch. 15 - Prob. 9E Ch. 15 - Prob. 10E Ch. 15 - Prob. 11E Ch. 15 - Prob. 12E Ch. 15 - Prob. 13E Ch. 15 - Prob. 14E Ch. 15 - Prob. 15E Ch. 15 - Prob. 16E Ch. 15 - Prob. 17E Ch. 15 - Prob. 18E Ch. 15 - E15-19 (L04) (Comparison of Alternative Forms of...Ch. 15 - Prob. 20E Ch. 15 - *E15-21 (L05) (Preferred Dividends) The...Ch. 15 - Prob. 22E Ch. 15 - Prob. 23E Ch. 15 - Prob. 24E Ch. 15 - Prob. 1P Ch. 15 - Prob. 2P Ch. 15 - Prob. 3P Ch. 15 - Prob. 4P Ch. 15 - Prob. 5P Ch. 15 - Prob. 6P Ch. 15 - Prob. 7P Ch. 15 - Prob. 8P Ch. 15 - Prob. 9P Ch. 15 - Prob. 10P Ch. 15 - Prob. 11P Ch. 15 - Prob. 12P Ch. 15 - Prob. 1CA Ch. 15 - Prob. 2CA Ch. 15 - Prob. 3CA Ch. 15 - Prob. 4CA Ch. 15 - Prob. 5CA Ch. 15 - Prob. 6CA Ch. 15 - Prob. 7CA Ch. 15 - Prob. 1UJ Ch. 15 - Prob. 2UJ Ch. 15 - Prob. 3UJ Ch. 15 - Prob. 4UJ Ch. 15 - Prob. 1CE Ch. 15 - Prob. 2CE Ch. 15 - Prob. 3CE Ch. 15 - Prob. 4CE Ch. 15 - Prob. 1CRC Ch. 15 - Prob. 1IST Ch. 15 - Prob. 2IST Ch. 15 - Prob. 3IST Ch. 15 - Prob. 4IST Ch. 15 - Prob. 5IST Ch. 15 - Prob. 1ICA Ch. 15 - Prob. 2ICA Ch. 15 - Prob. 3ICA Ch. 15 - Prob. 4ICA Ch. 15 - Prob. 5ICA Ch. 15 - Prob. 6ICA Ch. 15 - Prob. 7ICA Ch. 15 - Prob. 8ICA Ch. 15 - Prob. 9ICA Ch. 15 - Prob. 10ICA Ch. 15 - Prob. 11ICA Ch. 15 - Prob. 12ICA Ch. 15 - Prob. 13ICA

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