INTERMEDIATE ACCOUNTING <CUSTOM LL>
10th Edition
ISBN: 9781260887068
Author: SPICELAND
Publisher: MCG CUSTOM
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Chapter 18, Problem 18.6DMP
To determine
Share issue cost: Cost such as legal fee, promotional charge, and accounting services incurred for the purpose of share issuance would reduce the net cash proceeds from the sale of shares.
To write: A memo to the supervisor explaining the difference between the treatment for the share issue cost from the way debt issue costs are recorded.
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QUESTION 10
Which of the following statements about registering securities with the SEC is not true?
Oa. it is an inexpensive process
b. it requires the disclosure of accounting information
c. it is a time-consuming process
d. it provides information to prospective investors
Question 3
6:15 A M M
{l 59%i
You have reviewed the work performed by
your assistant, Samson Chow, on the audit of
Bexca Ltd for the year ended 30 June 2018
and
have
noted
the
following
two
independent matters:
(i)
In
testing investments
in
listed
securities,
Samson
selected
all
shareholdings with a market value
above $200,000 and checked them to
the closing market value reported by
Stock Exchange to
the Australian
determine the net realisable value of
each shareholding. The items tested
totalled $5,500,000, or 60% of the total
balance. Of the items tested, only one
error of $110,000 was discovered.
Samson concluded that the error was
not itself material, as only 2% of the
balance was tested. He extrapolated
this error to the total population and
estimated that the error for the total
population would be $185,000, which
was also immaterial. Therefore, he
concluded that the investments in listed
securities were fairly stated at the
lower of cost or net realisable value.
(ii)
Bexca Ltd…
Problem 12.9 (Algo) Securities held-to-maturity; trading securities and equity investments [LO12-1, 12-2,
12-3, 12-5]
Amalgamated General Corporation is a consulting firm that also offers financial services through its credit division. From time to time the company buys and sells securities. The following selected transactions relate to Amalgamated's investment activities during the last quarter of 2021 and the first month of 2022. The only securities held by Amalgamated at October 1, 2021 were $32 million of 10% bonds of Kansas Abstractors, Inc. purchased on May 1, 2021 at face value and held in Amalgamated's trading securities portfolio. The company's fiscal year ends on December 31.
2021
Oct. 18 Purchased 2 million shares of Millwork Ventures Company common stock for $55 million. Millwork has a total of 32 million
shares issued.
31 Received semiannual interest of $1.6 million from the Kansas Abstractors bonds.
Nov.
1 Purchased 10% bonds of Holistic Entertainment Enterprises at their…
Chapter 18 Solutions
INTERMEDIATE ACCOUNTING <CUSTOM LL>
Ch. 18 - Identify and briefly describe the two primary...Ch. 18 - Prob. 18.2QCh. 18 - Prob. 18.3QCh. 18 - Prob. 18.4QCh. 18 - Prob. 18.5QCh. 18 - Prob. 18.6QCh. 18 - Prob. 18.7QCh. 18 - What is meant by a shareholders preemptive right?Ch. 18 - Terminology varies in the way companies...Ch. 18 - Most preferred shares are cumulative. Explain what...
Ch. 18 - The par value of shares historically indicated the...Ch. 18 - Prob. 18.12QCh. 18 - How do we report components of comprehensive...Ch. 18 - The balance sheet reports the balances of...Ch. 18 - At times, companies issue their shares for...Ch. 18 - Prob. 18.16QCh. 18 - The costs of legal, promotional, and accounting...Ch. 18 - When a corporation acquires its own shares, those...Ch. 18 - Discuss the conceptual basis for accounting for a...Ch. 18 - The prescribed accounting treatment for stock...Ch. 18 - Brandon Components declares a 2-for-1 stock split....Ch. 18 - What is a reverse stock split? What would be the...Ch. 18 - Suppose you own 80 shares of Facebook common stock...Ch. 18 - Prob. 18.24QCh. 18 - Comprehensive income LO181 Schaeffer Corporation...Ch. 18 - Stock issued LO184 Penne Pharmaceuticals sold 8...Ch. 18 - Prob. 18.3BECh. 18 - Prob. 18.4BECh. 18 - Prob. 18.5BECh. 18 - Retirement of shares LO185 Agee Storage issued 35...Ch. 18 - Treasury stock LO185 The Jennings Group...Ch. 18 - Prob. 18.8BECh. 18 - Prob. 18.9BECh. 18 - Property dividend LO187 Adams Moving and Storage,...Ch. 18 - Stock dividend LO188 On June 13, the board of...Ch. 18 - Prob. 18.14BECh. 18 - Stock split LO188 Refer to the situation...Ch. 18 - Prob. 18.16BECh. 18 - Prob. 18.2ECh. 18 - Earnings or OCI? LO182 Indicate by letter whether...Ch. 18 - Stock issued for cash; Wright Medical Group LO184...Ch. 18 - Issuance of shares; noncash consideration LO184...Ch. 18 - Prob. 18.6ECh. 18 - Share issue costs; issuance LO184 ICOT Industries...Ch. 18 - Prob. 18.14ECh. 18 - Prob. 18.16ECh. 18 - Prob. 18.20ECh. 18 - Prob. 18.22ECh. 18 - Prob. 18.25ECh. 18 - Various stock transactions; correction of journal...Ch. 18 - Prob. 18.1DMPCh. 18 - Prob. 18.6DMPCh. 18 - Prob. 18.8DMP
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