INTERMEDIATE ACCT.(LL)-PACKAGE>CUSTOM<
9th Edition
ISBN: 9781309099148
Author: SPICELAND
Publisher: MCG/CREATE
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Textbook Question
Chapter 20, Problem 20.3E
Change from the
• LO20–2
In keeping with a modernization of corporate statutes in its home state, UMC Corporation decided in 2018 to discontinue accounting for reacquired shares as treasury stock. Instead, shares repurchased will be viewed as having been retired, reassuming the status of unissued shares. As part of the change, treasury shares held were reclassified as retired stock. At December 31, 2017, UMC’s balance sheet reported the following shareholders’ equity:
Required:
Identify the type of accounting change this decision represents and prepare the
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2. What amount should be reported as básic EPS for 2021
Problem 19-16 (AICPA Adapted)
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Strauch Company had one class of share capital outstanding
and no other securities that are potentially convertible into
ordinary shares. During 2021, 120,000 shares were
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On April 1, 2022, 40,000 shares of treasury were sold, and on
July 1, 2022, a 2-for-1 share split was issued.
C.
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Net income was P6,000,000 in 2022 and P3,600,000 in 2021.
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1. What amount should be reported as basic EPS for 2022
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Chapter 33 -Statement of Changes in Equity | 33-15
MCP 33-9 - Changes in equity
The Dec. 31, 2021 balance sheet of Jasmine Corp. showed
shareholders' equity of P448,700. Transactions during 2021 which
affected the shareholders' equity were: (1) an adjustment to Retained
Earnings for an overstatement of depreciation in 2020 P10,000; (2)
gain on the sale of treasury shares, P9,000; (3) declared dividends of
P60,000 of which P40,000 were paid during the year; and (4) net
income after tax of P75,500. The share capital balance of P300,000
remain unchanged during the year.
The retained earnings balance on Jan. 1, 2020 was
a. P134,200
b. P132,300
c. P123,200
d. P114,200
MCP 33-10- Changes in equity
An entity was incorporated on June 1, 2021 with an authorized
Problem 18-5 (Static) Shareholders' equity transactions; statement of shareholders' equity [LO18-6,18-
7,18-8]
Listed below are the transactions that affected the shareholders' equity of Branch-Rickle Corporation during the period 2021=2023. At
December 31, 2020, the corporation's accounts included:
57:28
Common stock, 105 million shares at $1 par
Paid-in capital-excess of par
Retained earnings
sin
thousands)
$105,000
630,000
970,000
at
nces
a. November 1, 2021, the board of directors declared a cash dividend of $0.80 per share on its common shares, payable to
shareholders of record November 15, to be paid December
b On March 1, 2022, the board of directors declared a property dividend consisting of corporate bonds of Warner Corporation that
Branch Rickie was holding as an investment. The bonds had a fair value of $1.6 million, but were purchased two years previously for
$1.3 million. Because they were intended to be held to maturity, the bonds had not been previously written up. The…
Chapter 20 Solutions
INTERMEDIATE ACCT.(LL)-PACKAGE>CUSTOM<
Ch. 20 - Prob. 20.1QCh. 20 - There are three basic accounting approaches to...Ch. 20 - Prob. 20.3QCh. 20 - Lynch Corporation changes from the...Ch. 20 - Sugarbaker Designs Inc. changed from the FIFO...Ch. 20 - Most changes in accounting principles are recorded...Ch. 20 - Southeast Steel, Inc., changed from the FIFO...Ch. 20 - Prob. 20.8QCh. 20 - Its not easy sometimes to distinguish between a...Ch. 20 - For financial reporting, a reporting entity can be...
Ch. 20 - Prob. 20.11QCh. 20 - Describe the process of correcting an error when...Ch. 20 - Prob. 20.13QCh. 20 - If it is discovered that an extraordinary repair...Ch. 20 - Prob. 20.15QCh. 20 - Change in inventory methods; FIFO method to the...Ch. 20 - Change in inventory methods; average cost method...Ch. 20 - Change in inventory methods; FIFO method to the...Ch. 20 - Change in depreciation methods LO203 Irwin, Inc.,...Ch. 20 - Prob. 20.5BECh. 20 - Book royalties LO204 Three programmers at Feenix...Ch. 20 - Warranty expense LO204 In 2017, Quapau Products...Ch. 20 - Change in estimate; useful life of patent LO204...Ch. 20 - Prob. 20.9BECh. 20 - Error correction LO206 In 2018, internal auditors...Ch. 20 - Prob. 20.11BECh. 20 - Error correction LO206 In 2018, the internal...Ch. 20 - Change in principle; change in inventory methods ...Ch. 20 - Change in principle; change in inventory methods ...Ch. 20 - Change from the treasury stock method to retired...Ch. 20 - Change in principle; change to the equity method ...Ch. 20 - Prob. 20.5ECh. 20 - FASB codification research LO202 Access the FASB...Ch. 20 - Change in principle; change in inventory cost...Ch. 20 - Change in inventory methods; FIFO method to the...Ch. 20 - Change in inventory methods; FIFO method to the...Ch. 20 - Change in depreciation methods LO203 For...Ch. 20 - Change in depreciation methods LO203 The Canliss...Ch. 20 - Book royalties LO204 Dreighton Engineering Group...Ch. 20 - Loss contingency LO204 The Commonwealth of...Ch. 20 - Warranty expense LO204 Woodmier Lawn Products...Ch. 20 - Prob. 20.15ECh. 20 - Accounting change LO204 The Peridot Company...Ch. 20 - Change in estimate; useful life and residual value...Ch. 20 - Classifying accounting changes LO201 through...Ch. 20 - Error correction; inventory error LO206 During...Ch. 20 - Error corrections; investment LO206 Required: 1....Ch. 20 - Prob. 20.21ECh. 20 - Prob. 20.22ECh. 20 - Prob. 20.23ECh. 20 - Inventory errors LO206 Indicate with the...Ch. 20 - Classifying accounting changes and errors LO201...Ch. 20 - Change in inventory costing methods; comparative...Ch. 20 - P 20-2 Change in principle; change in method of...Ch. 20 - Change in inventory costing methods; comparative...Ch. 20 - Change in inventory methods LO202 The Rockwell...Ch. 20 - Change in inventory methods LO202 Fantasy...Ch. 20 - Change in principle; change in depreciation...Ch. 20 - Depletion; change in estimate LO204 In 2018, the...Ch. 20 - Accounting changes; six situations LO201, LO203,...Ch. 20 - Prob. 20.9PCh. 20 - Inventory errors LO206 You have been hired as the...Ch. 20 - Error correction; change in depreciation method ...Ch. 20 - Accounting changes and error correction; seven...Ch. 20 - Prob. 20.13PCh. 20 - Prob. 20.14PCh. 20 - Prob. 20.15PCh. 20 - Prob. 20.16PCh. 20 - Prob. 20.17PCh. 20 - Integrating Case 201 Change to dollar-value LIFO ...Ch. 20 - Prob. 20.2BYPCh. 20 - Prob. 20.3BYPCh. 20 - Analysis Case 204 Change in inventory methods;...Ch. 20 - Prob. 20.5BYPCh. 20 - Prob. 20.6BYPCh. 20 - Analysis Case 208 Various changes LO201 through...Ch. 20 - Analysis Case 209 Various changes LO201 through...Ch. 20 - Prob. 20.10BYPCh. 20 - Prob. 20.11BYPCh. 20 - Prob. 20.12BYPCh. 20 - Prob. 1CCTC
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- Problem #13 Correction of Errors The following information was discovered during an audit, before the books of Sorima Corporation were closed for 2019: 1. No record had been made of a 50% share dividend declared and issued in June 2019. Prior to the share dividend, the corporation had 200,000 shares of P10 par value ordinary shares outstanding. The stock was selling for P21 per share when the share dividend was declared. 2. On Sept. 1, 2019, the corporation purchased 1,000 shares of its own ordinary shares for P24 a share and included the stock with its trading investments. On Oct. 1, 2019, it sold 500 of these shares for P25 per share. 3. In November, 2,000 shares of P100 par value convertible preference shares, which had originally been issued at par, were converted to ordinary shares. Each share of preference shares was convertible into four shares of ordinary shares. 4. On Dec. 30, 2019, Sorima Corporation declared a P1 per share cash dividend on ordinary shares. Since the dividend…arrow_forward4. How much is the gain (loss) on the sale of Mad Company ordinary shares on July 18, 2023? A. P4,500B. P3,000C. P1,500D. P0 5. What is the amount transferred to retained earnings if Jam Company opted to transfer the unrealized gain or loss relating to the shares sold? A. P11,100B. P5,500C. P5,100D. P1,500arrow_forwardIn keeping with a modernization of corporate statutes in its home state, UMC Corporation decided in 2018 to discontinue accounting for reacquired shares as treasury stock. Instead, shares repurchased will be viewed as having been retired, reassuming the status of unissued shares. As part of the change, treasury shares held were reclassified as retired stock. At December 31, 2017, UMC’s balance sheet reported the following shareholders’ equity: ($ in millions) Common stock, $1 par $ 300 Paid-in capital—excess of par 1,200 Retained earnings 1,156 Treasury stock (6.0 million shares at cost) (125 ) Total shareholders’ equity $ 2,531 Required:Identify the type of accounting change this decision represents and prepare the journal entry to effect the reclassification of treasury shares as retired shares.arrow_forward
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- Which statement is true regarding the new Companies Act 71 of 2008? Select one: a. Companies are no longer allowed to issue par value shares. b. Companies are now expected to be managed by shareholders. c. Companies are no longer allowed to issue capitalization shares. d. Companies are only permitted to issue redeemable Preference sharearrow_forwardProblem 8-26 (Algo) Treasury stock transactions LO 6 [The following information apples to the questions displayed below) On January 1, 2019, Metco Inc. reported 290,000 shares of $4 par value common stock as being issued and outstariding On March 24, 2019, Metco Inc. purchased for Its treasury 4,000 shares of its common stock at a price of $39.00 per share. On August 19, 2019, 590 of these treasury shares were sold for $42.50 per share. Metco's directors declared cash dividends of $0.30 per share during the second quarter and again during the fourth quarter, payable on June 30, 2019. and December 31, 2019, respectively. A 3% stock dividend was issued at the end of the year. There were no other transactions affecting common stock during the year. Problem 8-26 (Algo) Part d d. Calculate the total amount of cash dividends paid in the fourth quarter. Dividend paidarrow_forwardExercise 18-10 (Static) Retirement of shares [LO18-5] Borner Communications' articles of incorporation authorized the issuance of 130 million common shares. The transactions described below.effected changes in Borner's outstanding shares. Prior to the transactions, Borner's shareholders' equity included the following: Shareholders' Equity Common stock, 100 million shares at $1 par Paid-in capital excess of par Retained earnings ($ in millions) $100 300 210 Required: Assuming that Borner Communications retires shares it reacquires (restores their status to that of authorized but unissued shares). record the appropriate journal entry for each of the following transactions: (If no entry is required for a transaction/event, select "No Journal entry required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) 1. On January 7, 2021, Borner reacquired 2 million shares at $5 per share. 2. On August 23, 2021, Borner reacquired 4 million…arrow_forward
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