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Chapter 15: Question 3IFRS (page 825)

Briefly discuss the implications of the financial statement presentation project for the reporting of stockholders’ equity.

Short Answer

Expert verified

For reporting of stockholders’ equity presentation project will be closely checked.

Step by step solution

01

Meaning of Stockholders’ Equity

Stockholders' equity is the money that will be cleared in the event a company sells all of its assets and pays off all of its debt. The money meant for the proprietors of the company will be abolished. This includes its shareholders, who are partial owners. This is the net worth of a company.

02

Explaining the implication of the financial statement presentation project for the report for the stockholders’ equity.

It is likely that the details of stockholders' equity and its presentation within the financial statement introduction project will be closely monitored. In detail, the options for how other comprehensive income is presented under GAAP will change to any standard area.

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Most popular questions from this chapter

Discuss the propriety of showing:

  1. Treasury stock as an asset.
  2. “Gain” or “loss” on sale of treasury stock as additions to or deductions from income.
  3. Dividends received on treasury stock as income.

Kaymer Corporation issued 300 shares of \(10 par value ordinary shares for \)4,500. Prepare Kaymer’s journal entry.

Before Gordon Corporation engages in the treasury stock transactions listed on the next page, its general ledger reflects, among others, the following account balances (par value of its stock is \(30 per share).

Paid-in Capital in Excess of Par Common Stock Retained Earnings

Common Stock

\)99,000 \(270,000 \)80,000

Instructions

Record the treasury stock transactions (given below) under the cost method of handling treasury stock; use the FIFO method for purchase-sale purposes.

(a) Bought 380 shares of treasury stock at \(40 per share.

(b) Bought 300 shares of treasury stock at \)45 per share.

(c) Sold 350 shares of treasury stock at \(42 per share.

(d) Sold 110 shares of treasury stock at \)38 per share.

Explain each of the following terms: authorized capital stock, unissued capital stock, issued capital stock, outstanding capital stock, and treasury stock.

How are restrictions of retained earnings reported?
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